University  of  California. 

FROM     rUK    I.IBKAKY    ')F 

D  R  .     F  R  A  N  C  I  S     LI  E  li  E  R , 

rrofof=so.-  of  History  and  Law  in  Columbia  College,  New  York. 


iHi.  (ill  1   or 

MICHAEL     REESE, 

Of  San  FraiiLi'st'o. 
1873. 


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PUBLIC    ECONOMY. 


PUBLIC    ECONOMY 


FOR    THE 


UNITED    STATES. 


BY 


CALVIN    COLTON. 


NEW    YORK: 
PUBLISHED    BY    A.    S.    BARNES    &    CO. 

NO.    51    JOHN   STREET. 

CINCINNATI:  H    W.  DERBY  &  GO. 

18  48. 


p^ 


Ijl 


V^-C.(^1 


Entered,  according  to  Act  of  Congress,  in  the  year  1848, 

By    CALVIN    COLTON, 

in  the  Clerk's  Office  of  the  District  Court  of  the  United  States,  in  and  for  the  Southern 

District  of  New  York. 


STEREOTYPED    BY    KKDFIEI.D    &    SAVAGE, 
13  Chambere  Street,  N.  Y. 


NOTE. 


All  the  reasonings  of  this  work  on  European  society, 
are  based  on  the  statu  quo  of  its  condition  before  the 
convulsions  of  1848.  It  must  be  seen  that  these  recent 
and  current  events  are  not  sufficiently  ripe  to  be  used 
as  materials  in  a  work  of  this  kind. 


CONTENTS. 


CHAPTER  I. — Preliminary  Remarks page  17 

The  Task  attempted  in  this  Work — Tlie  Doctrine  of  Free-Trade  Economists  not  a  Sci- 
ence.— This  false  Pretension  a  stulen  Shield. — On  common  Ground.  Free-Trade  Econ- 
omists have  done  some  Good. — This  Work  a  System  for  the  United  States — The  New 
Features  of  this  W(3rk  not  Novelties — The  proper  Functions  of  Hypoibesis. — Free- 
Trade  Economists  have  made  an  unju.-^tifiable  Use  of  Hypothesis. — It  leads  to  no  Result. 
— Mill's,  Compte's,  Newton's,  and  Reid's  Views  of  Hypothesis — Rea.sons  for  the  lim- 
ited Scope  of  this  Work. — Reasons  for  changing  the  Name  of  the  General  Subject. — 
Politics  and  Political  Economy. — The  Comprehensiveness  of  this  Work,  and  the  Unity 
of  its  Plan. 

CHAPTER  II. — The  New  Points  of  this  Work page  26 

What  is  meant  by  these  New  Points. — The  First:  Definition  of  the  General  Subject. — 
Importance  and  Influence  of  Definitions. — Public  Economy  not  heretofore  reduced  to  a 
Science. — The  Definition  here  given  of  the  Subject  is  consistent  with  a  Science. — It  res- 
cues the  Subject  from  an  embarrassed  Condition  — The  Free-Trade  Theory  composed  of 
uniform  Propositions. — The  Exact  Sciences — All  Sciences,  when  fully  constructed,  are 
necessarily  exact. — Science  appertains  to  all  Subjects — The  Science  of  Sociology,  as 
announced  by  M.  Compte,  in  an  imperfect  State. — John  Stuart  Mill's  Definition  of  Sci- 
ence.— Why  the  Science  of  Sociology  is  Imperfect. — Mr.  Mill,  a  Free-Trader  by  Sym- 
pathy, has  demolished  the  Theory  by  Logic. — Citations  of  a  remarkable  Character  from 
Mr.  Mill. — What  they  prove. — Private  and  Public  Economy  compared. — Napoleon  on 
this  Subject. — Common  Principles  in  Systems  fundamentally  different. — How  our  Defi- 
nition affects  the  General  Argument. — Empirical  Laws  defined  — Public  Economy,  down 
to  this  Time,  lies  scattered  over  the  Field  of  Empirical  Laws,  and  has  not  been  reduced 
to  a  Science. — The  Free  Trade  Hypothesis  belongs  to  a  Category  of  Empirical  Laws 
incapable  of  being  reduced  to  a  Science  — The  recognised  Canons  of  Experimental  In- 
duction, as  laid  down  by  Logicians,  fully  sustain  the  Claims  of  Protection  against  those 
of  Free  Trade — The  Forn'.alion  of  the  Science  of  Public  Economy  is  j-et  in  Aieyance 
to  some  .skilful  and  competent  Hand. — A  Science  can  not  be  made  out  of  the  Laws  of 
Public  Economy,  except  for  one  Nation,  each  by  Itself — The  true  Position  of  Labor  — 
Labor  robbed  of  its  Rights  by  a  False  Position  in  Public  Econon)y. — Protective  Duties 
not  Taxes  in  the  United  States,  but  a  Rescue  from  Foreign  Taxation.— How  Public 
Economy  is  affected  by  different  States  of  Society. — New  Points  in  regard  to  Money 
and  a  Monetary  System. — The  Reasons  for  Free  Trade,  with  the  People,  are  Reasons 
for  Protection — All  desire  the  same  Thing. — The  Destiny  of  Freedom  not  yet  achieved. 
— The  Protective  Principle  identical  with  that  of  the  American  Revolution. — Free  Trade 
in  Great  Britain  not  based  on  Science,  but  on  Public  Policy. — Rise  and  Progress  of  the 
Free  Trade  Theory — Definition  of  Freedom. — An  American  System  of  a  Peculiar  Char- 
acter.— Free  Trade  identical  with  Anarchy. — Protection  can  never  be  dispensed  with, 
in  any  8uppo.sable  Perfection  of  American  Arts — Agricultural  Labor  and  Products  in 
the  Guise  of  Manufactures. — Not  two  Kinds  of  Economy. 


8  CONTENTS. 

CHAPTER  III.— Meaning  of  Frke  Trade page  60 

The  domestic  Orif^in  of  the  popular  Application  of  the  Terms,  Free  Trade. — Their  Ad- 
Captandum  Features.-^The  Unfairness  of  taking  Advantage  of  these  Features. — The 
true  Moaning  of  Free  Trade,  directly  the  Opposite  of  what  is  commonly  suppo.9cd. — Jus- 
tice on  the  Side  of  Protection. — Free  Trade,  to  be  Just,  requires  that  all  Nations  should 
be  one  Family. — Universal  Free  Trade  would  create  one  great  Central  Power,  at  the 
Expense  of  all  the  Rest. — Weak  Powers  can  only  be  defended  against  the  Strong  by  a 
Protective  System. — The  Free-Trade  Millennium  an  Absurdity. — Expensive  and  Cheap 
Organizations  of  Society,  as  they  affect  this  Q,ue.«tion. — American  Instincts  on  the  Rights 
of  Labor. — The  Objections  to  Protection  are  the  Reasons  for  It. — The  Free  Trade  of 
Adam  Smith  not  the  Free  Trade  of  the  Present  Time. 

CHAPTER  IV. — Free  Trade  a  License  for  Depredation  on  the  Rights  of 
Others page  69 

This  a  New  Position. — It  is  based  on  the  Principle  of  Anarchy. — The  Es-sence  of  Free 
Trade  is  a  Plea  for  no  Law  over  an  important  and  wide  Domain  of  Interests. — Defini- 
tion of  this  Domain. — Nations  are  Commonwealths,  and  may  be  vulnerable  or  injurious, 
in  their  Relations  to  each  other,  the  same  as  Private  Individuals  in  each. — The  Defensive 
of  Man's  Position,  in  all  Circumstances,  requires  most  Care,  and  costs  Most. — Time  only, 
and  protracted  Experiment,  will  determine  the  relative  Merits  of  Free  Trade  and  a  Pro- 
tective System. — The  Point  of  Vulnerability  in  the  United  States,  opened  by  Free  Trade. 
— The  great  Problem  one  of  Figures  and  Cluantiiies,  that  can  be  worked  out. — The 
Negative  Losses  occasioned  to  Individuals  and  to  the  Country,  by  Free  Trade,  though 
Real  and  Serious,  not  easily  ascertained. — More  and  greater  Interests  at  Stake,  on  the 
Ground  proposed  to  be  given  up  to  Anarchy  by  Free  Trade,  than  anywhere  else. —  The 
Hen  and  Chickens  and  Hawk,  are  like  Nations  and  Free  Trade. — How  this  Anarchy  of 
Free  Trade  operates. — It  is  real  Anarchy  97^0  ad  hoc,  opening  a  vast  Field  for  Depre- 
dation.— Free  Trade  is  the  Sway  of  the  Will  of  the  Individual,  as  opposed  to  that  of 
Society. — The  Principle  of  Free  Trade  everywhere  at  Work  for  Depredation. — Free 
Trade  not  equally  Fair  for  both  Sides. — Great  Britain  not  for  Free  Trade. — An  important 
Confession  of  a  Member  of  Sir  Robert  Peel's  Government. — The  Absurdity  of  making 
Laws  for  the  less  important  Sphere,  and  doing  without  Law  in  the  most  important  — 
The  Charge  of  Free  Trade  against  Protection,  falls  back  on  Itself,  in  precisely  the  same 
Form. — Under  Free  Trade  we  are  forced  to  buy,  in  the  Form  of  Manufactures,  the  same 
Things  which  we  produce,  while  our  Products  perish  on  Hand. — Answer  to  Objections 
to  the  Theory  of  this  Chapter. — Free  Trade  operates,  through  a  second  Party,  to  injure 
a  third  Party,  and  the  Scope  of  this  Influence  takes  in  whole  Nations,  as  Subjects  of  its 
Depredations. 

CHAPTER  V. —  Reasons  of  the  Rise  and  Progress  of  the  Theory  of 
Free  Trade page  87 

The  Prevalence  of  Free  Trade  makes  a  Problem. — The  Rules  by  which  it  is  to  be  solved. 
— British  Writers  and  Literature  on  this  Subject. — The  Free-Trade  Epoch. — British 
Legislation  for  Protection,  and  the  Effect  of  this  Policy  for  a  Century  previous  to  Adam 
Smith. — Treatment  of  the  American  Colonies  under  the  Crown. — Its  Inconsistency  witli 
Free  Trade. — Free  Trade  in  Great  Britain  a  State  Policy,  not  a  General  Principle. — 
Adam  Smith  employed  by  the  British  Government  to  write  his  Book. — His  Inconsistency 
and  Self  Contradiction. — Examples. — The  chief  Aim  of  Adam  Smitli,  was  to  reconcile 
the  American  Colonies  to  Injustice. — Free  Trade  a  British  Instinct  and  Selfi.sh. — MCul- 
loch's  Betrayal  of  British  Policy. — The  Authority  of  British  Writers  on  Free  Trade. — 
Their  Authority  in  our  Schools,  and  in  forming  the  Minds  of  our  Statesmen. — Ob.sequious- 
ness  and  Sorviliiy  of  American  Free-Trade  Economi.'its — Free  Trade  a  one-legged 
Science. — Bom  in  the  Closet. — British  Free  Trade  Writers  Employees  of  the  British 
Government. — History  of  Free  Trade  as  a  Party  Question  in  the  United  States.— Its 
Prevalence  here  owing  to  Social  Position  and  Obsequiousness. — Instincts  of  the  Ameri- 
can People  in  Favor  of  Protection. — Free  Trade  can  not  be  the  permanent  Policy  of  tlie 
United  States. 


CONTENTS.  » 

CHAPTER  VI. — Great  Britain  the  only  Nation  that  is  prepared  for 
Free  Trade,  and  the  United  States  the  last  that  can  afford  it  .  page  100 

The  Importance  of  Position,  in  all  Competition,  illustrated  by  familiar  Examples. — Adam 
Smith's  Illustration. — The  Tribe  or  Nation  that  is  ahead  in  Manufactures,  can  keep  ahead, 
by  Free  Trade. — The  first  Lessons  on  Protection  to  Great  Britain. — The  Way  of  her 
Beginning,  and  its  Re.'^ults. — It  was  by  this  System  that  she  was  able  to  triumph  over 
Napoleon. — Great  Britain  was  Poor  when  she  began  her  Protective  System. — Behold 
the  Consequences. — Great  Britain  always  consults  the  Parties  interested  in  Protection, 
and  complies  with  their  Wishes. — Not  so  the  United  States. — A  remarkable  Example  of 
taming  Witnesses  out  of  Court. — British  Manufacturers,  from  the  Strength  of  their  Posi- 
tion, have  consented  to  dispense  with  Protection. — M'Gregor's  Evidence  and  Advice  to 
the  British  Government. — MCulloch's  Confession. — Action  of  the  States  of  Europe,  after 
the  Overthrow  of  Napoleon,  in  Favor  of  Free  Trade.— Their  Repentance. — Repent- 
ance of  Ru.ssia. — Manifesto  of  Count  Nesselrode. — The  Zoll  Vereiii  Treaty. — Napoleon's 
Policy. — The  Policy  of  the  European  Continental  Nations  against  Great  Britain,  defen- 
Bive. — The  greater  Cost  of  Money  and  Labor  in  the  United  States  an  insuperable  Bar 
to  Free  Trade. — The  Weak,  not  the  Strong,  require  Protection. — British  Free  Trade, 
not  Free  Trade. — British  Differential  Duties  retained. — Effect  of  Commercial  Treaties. 
—The  Whole  Truth  in  few  Words. 

CHAPTER  VII.  —  Freedom  consists  in  the  Enjoyment  of  Commercial 
Rights,  and  in  the  Independent  Control  of  Commercial  Values  fairly 
Acquired page  114 

The  Novelty  and  Importance  of  this  Proposition,  a  Reason  for  giving  it  an  early  Place  in 
this  Work. — What  is  Meant  by  it. — Definition  of  Commercial  Rights  and  Values. — 
Liberty  not  synonymous  with  Freedom. — Rights  as  distinguished  from  Liberty. — Free- 
dom, not  an  Abstraction,  but  a  Reality. — Is  a  definable  Substance. — The  Objects  of 
Despotism  of  every  kind,  even  Spiritual,  are  Commercial  Values. — All  Religious  Privi- 
leges are  Secured  and  Fortified  by  Commercial  Values. — Freedom  requires,  that  all 
Taxes  should  be  Voluntaiy,  by  a  Representative  Voice.— Otherwise  they  are  an  Ex- 
tortion, and  not  Freedom. — "Voting  Supplies."— The  British  Government  more  imme- 
diately under  the  Control  of  Popular  Freedom  than  that  of  the  United  States. — The 
Mexican  War  an  Example. — Manj^  things  are  called  Freedom  which  are  only  its  Acci- 
dents and  Results. — A  reasonable  Man  will  be  contented  with  Freedom  as  here  de- 
fined.— A  Man's  Commercial  Rights  includes  his  Chances  in  the  Future. — The  Blood 
of  Martyrs  shed  on  Account  of  Commercial  Values. — The  Test  of  the  Principle  con- 
tended for. 

CHAPTER  VIII. — What  caused  the  American  Revolution. — History  or 
THE  Protective  Policy  in  the  United  States page  126 

A  Restatement  of  the  Object  of  this  Work,  and  of  the  great  Error  of  the  Economists. — The 
Theme  of  this  Chapter  important  as  a  Starting  Point  in  the  General  Argument. —  The 
Instinctive  Policy  of  a  Parent  State  toward  Remote  Dependencies,  fatal  to  the  End  in 
View. — Such  was  the  Policy  of  Great  Britain  toward  her  North  American  Colonies. — A 
Review  of  that  Policy. — The  Doctrines  of  Joshua  Gee. — Their  Influence  on  Parliament 
and  the  Board  of  Trade. — Acts  of  Opposition  and  Wrong  Provoked  the  Revolution. — 
Di'claration  of  Independence. — Commercial  Values,  as  the  Fruits  of  Labor,  the  Occasion 
of  the  Contest. — The  Position  of  the  Free-Trade  Economists  as  to  the  Elements  of  this 
Controversy. — They  v^'ere  forced  to  justify  Wrong. — The  Wrong  a  Commercial  one. — 
The  Aim  of  the  Revolution  was  to  break  down  the  Old,  and  to  establish  a  New  System 
of  Public  Economy,  that  is,  a  Protective  System. — The  Struggle  was  based  on  the  Prin- 
ciple of  Mine  and  Thine,  as  it  determines  Commercial  Rights. — A  Protective  System  of 
Society  the  great  Object  in  this  Country  from  the  First. — The  great  Movement  from 
Europe  to  America  was  and  is  for  this. — The  Confederation  a  Rope  of  Sand. — A  Pro- 
tective System  the  great  Object  of  the  Federal  Constitution. — One  of  the  first  Acts  of 
the  new  Congress  was  to  establish  a  Protective  System. — Documentary  Evidence  for 
Fifty  Year.'5.  that  Protection  was  the  Uniform  Policy  of  the  Country. — The  Cause  of 
Apostacy  from  this  Ancient  Faith. 


10  CONTENTS. 

CHAPTER  IX.  —  The  Destiny   of  American   Freedom   not   yet   Achiev 

ED PAGE    142 

The  general  Desire  for  Freedom,  before  and  after  the  Discovery  and  Settlement  of  Amer- 
ica.— American  Independence  an  Epoch  of  Freedom. — "An  American  System"  means 
much. — It  is  a  "Commercial  System." — "Political"  the  Shadow,  "Commercial"  the 
Substance. — The  ReBpon.sibility  of  a  Nation  that  ha.s  Freedom  in  Trust  for  Posterity  and 
for  Mankind. — Faith  as  a  Power  in  Man  for  the  Attainment  of  Freedom — The  Advo- 
cates of  Freedom  are  in  general  practically  Right,  though  often  theoretically  Wrong. — 
Freedom  yet  in  its  Cradle. — The  vacillating  Policy  of  the  Country  in  regard  to  the 
Means  of  Freedom. — Seventy  Years  of  the  Era  of  American  Freedom  gone,  and  yet 
Freedom  was  to  be  Defined. — The  People  have  much  to  Learn  on  this  Subject. — What 
Great  Britain  and  Europe  Desire. — The  Jeopardy  of  American  Freedom. — Free  Trade 
would  throw  it  away  —  would  Sell  It. 

CHAPTER  X. —  The  Different  States  of  Society  in  Europe  and  America 
require  Different  Systems  of  Public  Economy page  151 

The  three  fundamental  Elements  of  European  Economists. — Adam  Smith's  and  Ricardo's 
Statement  of  them. — These  Elements  do  not  exist  in  the  United  States  as  a  Rule,  but 
only  as  Exceptions. — The  Ancient  System  of  European  Society  gives  Character  to 
the  Modern. — The  economical  Position  of  the  Laborer  there,  the  same  as  that  of  the  Ox 
or  the  Slave. — This  Position  assigned  to  Labor  by  European  Economists,  as  proved  by 
their  own  Statements. — The  Theory  of  Malthus  justifies  this  Position. — This  Doctrine 
pervades  the  European,  and  has  been  transferred  into  American  Systems  of  Economy. 
— The  prevalent  Principle  of  Land  Tenures  in  Europe  fundamentally  different  from 
that  which  prevails  in  the  United  States. — "  Rent"  the  lord  of  all  in  Europe — The  Prin- 
ciple of  Serfdom  and  Villanage,  nnder  other  names,  still  prevails  in  that  quarter  of  the 
World. — Labor  doomed  there. — American  Society  fundamentally  different. — The  same 
System  of  Public  Economy  can  not  apply  to  each. — Reform  in  America,  slow,  but  sure. — 
Can  only  be  effected  by  Public  Economy. — Free-Trade  Economy  hostile  to  Popular 
Rights. 

CHAPTER  XI. —  Education  as  an  Element  of  Public  Economy  in  the  Uni- 
ted States page  169 

Education  a  Thing  of  Commercial  Value. — The  American  People  the  Oriijinal  Statesmen 
of  the  Country. — The  American  Republic  an  Experiment  for  the  World — Difference 
between  the  European  and  American  Theory  of  Society. — Knowledge  makes  the  Dis- 
tinction between  Freemen  and  Slaves — Character  of  the  First  Settlers  of  this  Country. — 
They  were  Men  of  high  Culture. — General  Education  made  the  Basis  of  their  New 
State  of  Society. — Education  the  Power  that  achieved  American  Independence. — It  is 
the  most  Important  of  all  the  Elements  of  an  American  System  of  Public  Economy. — 
A  System  of  Universal  Education  may  not  at  fir.st  Produce  Examples  of  the  highest 
Culture. — The  American  Sy.stem  gives  Equal  Chances  to  All  — System  of  Americaa 
Schools  and  Colleges. — A  Protective  System  of  Public  Economy  indispensable  to  the 
American  System  of  Education. — Education  and  Virtue  Concomitant-*  in  a  Nation. — 
Comparative  Condition  of  European  and  American  Population. — Physical  and  Moral 
Education  makes  the  Difference. 

CHAPTER  Xn. — Protection  not  Restriction,  but  Emancipation,  .page  180 
What  is  meant  by  a  Restrictive  System. — It  is  a  Misnomer  as  applied  to  Protection. — 
Free  Traders  and  Protectionists  in  the  United  States  are  both  after  the  same  thing. — 
The  true  Relation  between  Capital  and  Labor. — The  most  perfect  Slate  of  Society — 
Capital  is  Labor  in  Repose. — Protection  of  Capital  is  the  Protection  of  Labor. — An 
American  Protective  System  a  Rescue  from  a  Foreign  Restrictive  System. — American 
Labor  can  not  be  free,  without  Protection. — The  Protection  of  one  American  Interest 
can  never  injure  another  American  Interest,  but  benefits  all. — Examples  and  Proofs. — 
The  Position  of  American  Capital  and  Labor  in  Relalion  to  Foreign  Capital  and  Labor. 
Consideration  of  the  Maxim  that  a  Nation  must  buy  in  Order  to  sell. — The  Prosperous 
and  Rich  buy  and  trade  most — Protection  makes  us  rich  ;  the  want  of  it  makes  us  poor. 

A  Rule  for  one  Nation  may  be  bad  for  another. — Why  does  Great  Britain  preach 

Free  Trade  ? — Adam  Smith  began  right,  and  ended  wrong. — He  leaped  to  his  Conclu- 
Bion  from  False  Premises. 


CONTENTS.  11 

CHAPTER  XIII.— MoNEV  pagf  189 

Barter,  its  Nature  — Oripiii  of  the  Name.  "  Precious  Metals." — How  Gold  and  Silver  came 
to  be  used  as  Moicejv — Go'd  not  u.'-ed  as  Money  in  all  Piiris  of  the  VVorld. — Relntive 
Proportions  of  the  Precious  Metals  en)ployed  as  Money  and  for  other  Purposes. — Foun- 
dation of  the  Value  of  Gold  and  Silver,  when  used  as  Money. — Turgot,  Say.  M'Culloch, 
and  others,  on  this  Point — The  Foundation  of  the  Value  of  Money  lies  in  the  Demand 
of  the  Precious  Metals  for  other  Uses. — It  is  a  Foundation  in  Nature,  not  the  Result  of 
Convention. — Definition  and  Functions  of  Money. 

CHAPTER  XIV.— Money page  203 

The  Di-^tinction  between  Money  as  a  Subject  and  as  the  Instrument  of  Trade — Review 
of  the  Doctrine  of  Adam  Smith  and  others  on  the  Relative  Position  of  Money  and  of  the 
Commodities  given  for  it. — Adam  Smith  versus  Adam  Smith. — Price  the  Attribute  of 
Commodities,  not  of  the  Money  given  for  them. — Smith  and  Others  on  this  Point  — Error 
and  Confusion  of  their  Doctrine. —  VVeighl  the  Measure  of  Money,  and  not  the  Commod- 
ities for  which  it  is  exchanged. —  Professor  Twiss'  "View  of  the  Progress  of  Political 
Economy,  since  the  Ifith  Century.'' — Mr.  Twiss  meets  the  Point,  and  puts  all  at  Stake. 
— Examination  of  his  Position. 

CHAPTER  XV.— Money  AS  THE  "Tools  OF  Tbade" page  223 

An  Illustration  of  this  Truth. — The  Condit'on  of  a  Nation,  after  selling  its  "  TooN  of  Trade," 
the  Same  as  that  of  a  Mecharjic  who  does  ihe  same  TliinL'. — Moniesqnieu's  Doctrine  on 
this  Point. — The  Emperor  of  Russia  inve.«ting  in  French  Stocks  —  Money  but  an  incon- 
siderable Fraction  of  a  Nation's  Wealth. — To  answer  its  Purposes,  Money  should  be  to 
a  Nation  as  a  fixed  Capital — It  is  "  Tools  " — Haifa  Set  of  "  Tools"  not  as  good  as  a  per- 
fect Set. — Money  the  necessary  Means  of  a  Nation's  VVenlih  — The  Amount  requiied  by 
a  Nati(m.  depends  on  its  Resources  and  Capabilities. — The  Charge  of  a  Miser  Spirit  on 
Protectionists  considered. — Bad  Economy  to  hoard  up  Money — The  Commercial  Revul- 
sions in  the  United  States  always  owing  to  the  VV'ant  of  Money  as  "  Tools  of  Trade." 

A  Protective  System  necessary  to  keep  on  hand  '•  Tools"  enough  — There  has  never  yet 
been  Money  enouizh  in  the  United  States  for  the  Busines.-^  of  the  People — Money  makes 
the  Mare  go. — To  have  Money  enoufih,  as  "  Tools  of  Trade,''  is  Evidence  of  Private 

and  Public  Economy. — Ignorance  the  Parent  of  Free  Trade  in  the  United  States. The 

PreciMus  Metals  are  to  Society  equivalent  to  a  Law  of  Nature  — Mr  Jacobs  on  the  Uses 
of  ihe  Precious  Metals — The  Quantity  of  the  Piecious  Metals  required  fur  the  Trade  of 
the  United  States — The  Commercial  Tronhlfs  of  tins  Country  owing  to  unfortunate  and 
fitful  Changes  in  the  Policy  of  the  Government. 

CHAPTER  XVI.— Paper-Money  and  BANiaNG page  2^0 

The  Principle  of  Credit. — The  United  States  built  up  by  Credit — Gold  and  Silver  a  Credit 
Currency. — Is  Bank-paper  Money? — The  Invention  of  P.iper-Money  a  great  Advance 
in  Civilization. — Facts  to  illustrate  its  Economy  and  Necessity  — It  greatly  ausnients  the 
Facilities,  Scope,  and  Powers  of  Commerce. — Facts  and  Authorities  to  this  Point  — 
Bankintr  the  In.strument  of  Paper-Money — The  American  System  of  Banking — Prin- 
ciples and  Benefits  of  Bankine:. — Adam  Smith's  Doctrine  that  Paper-Money  banishes 
Specie,  not  applicable  to  the  United  States — The  Precious  Metals  the  only  .>-ound  Basis 
of  Banking — The  visionary  and  unsettled  Opinions  of  Emopean,  particularly  Biitish 
Economists,  as  to  the  Basis  of  Banking.— Sir  Robert  Peel  right  at  last  in  his  Bill  of  1844. 
— A  Government  Bank  necessarily  in  a  false  Position. — The  Subtreasury  a  Government 
Bank— Treasury-Notes  are  Post-Notes— All  the  Functions  of  the  Treasury  by  making 
it  a  Government  Bank,  merged  in  that  Bank — The  Effecta  Danger,  and  Power  of  this 
Institution — It  subverts  the  Banking  System  of  the  Country. — The  In.stincts  and  Propen- 
sity of  the  Federal  Government  for  Banking,  as  illustrated  in  the  Subtreasury. 

CHAPTER  XVII. — The  Gain  of  Individuals  not  always  the  Gain  of  the 
CoMiwuNiTY page  260 

Views  of  Free  Trade  Economi.ots  on  this  Point — M'Ciilloch's  View  of  Capital  as  formed 
out  of  Profits. — MCnlloch's  Hobby. — The  Doctrine  of  Equivalents  in  Trade  considered: 
— Equivalents  in  Kind. — Money,  as  •'  Tools  of  Trade,"  not  an  Equivalent  in  Kind  —How 
this  affects  the  Doctrine  of  Free  Trade. — DifTerence,  economically,  between  Importations 


12  CONTENTS. 

for  Consumption  of  Vnlue,  and  Tiiiportations  to  be  improved  in  Value  or  otherwise  used 
for  Increase  of  Wealth. — The  Values  added  to  the  raw  Material  by  mannfaclurins'. — 
Every  Commercial  Transaction  independent. — Answer  to  ^ome  Points  made  by  M  Saj'. 

CHAPTER  XVIII.— Labor page  274 

Definition. — Who  ate  Laborers. — Labor  is  Capital. — The  Effect  of  not  recognisinf»  this 
Fact  in  Public  Economy. — The  False  Position  awarded  to  Labor  by  the  Economi.^ts. — 
The  Position  vvliich  they  themselves  occupy  False. — Labor  Capital  vested  in  Man  him- 
self and  estimated  by  his  Life  and  Powers. — Labor-Capital  reproduces  itself  indefinitely. 
— It  is  the  Parent  of  all  other  Capital  — It  is  more  Profitable  than  any  other — It  is  the 
Gift  of  God,  and  Inalienable. — The  Machinery  of  Society  is  its  Product,  which  reacts  to 
give  it  Value. — Labor-Capital  may  be  under  Restraint,  in  Certain  Circum.stances. — La- 
bor the  Source  of  all  Wealth,  by  creating  all  Commercial  Values. — Labor  bound  to  share 
in  the  Burdens  of  Society  and  entitled  to  Protection. — Labor  in  its  True  Position, 
defines  Human  Eights. — The  Perversion  and  Abuse  of  tho.se  Rights,  owing  to  its  False 
Position  in  Public  Economy. — The  Results  of  the  American  Revolution  put  it  in  the  light 
Place — Labor  Man's  Honor,  not  Disgrace. —  It  is  the  great  Political  Element. — Labor 
Discovered  and  made  America. — American  Independence,  Labor's  Jubilee. — Its  Conse- 
quences.— "  Kent,"  as  practised  in  Europe,  created  Cla.sses. — Labor  considered  as  the 
Agent  of  Power,  and  as  an  Independent  Agent. — The  former  Slavery,  the  latter  Free- 
dom— The  First  the  State  of  Labor  in  Europe,  the  second  its  Condition  in  the  United 
States. — The  Malthusian  Theory,  as  it  justified  European  Economists  and  European 
Society,  in  enslaving  Labor. — The  Theory  a  Blasphemy —This  Problem  solved  in 
America. — Origin  of  the  term  Landlord,  with  its  Lesson — Labor,  to  be  Free,  must  have 
an  Alternative  in  another  Chance  besides  the  Wages  offered. — Europe  does  not  afford 
that  Cliance.  America  does — Political  Chances  of  American  Citizens. — Causes  and  Ef- 
fects of  the  Difference  in  the  Value  of  Labor  and  Money,  in  Europe  and  America. — 
The  Power  and  Aims  of  Governments  which  oppress  Labor. — T'he  Interests  of  Civi- 
lization vested  in  Labor. — The  Rights  of  Labor,  Political. — The  Rights  of  Labor  the 
Strife  of  the  Age  — The  Pivot  on  which  it  turns. 

CHAPTER  XIX. — The  Difference  between  the  Cost  of  Money  and  Labor 
IN  Europe  and  their  Cost  in  the  United  States,  as  it  affects  Public 
Economy  for  the  United  States page  295 

The  comparative  Prices  of  Labor  in  Europe  and  tlie  United  States — These  Prices  deter- 
mine the  Value  of  Money  and  other  Capital  in  thewe  two  Quarters — Money  worth 
more  than  other  Capital. — Its  Value  in  any  Country,  and  at  any  given  Time,  determined 
by  the  Rate  of  Interest. — Some  Account  of  the  Hates  of  Interest  in  different  Countries, 
and  at  different  Times. — The  Average  Interest  of  Money  in  the  United  States,  as  com- 
pared with  the  Average  in  Europe. — Difference  in  the  joint  Co.st  of  Money  and  Labor 
in  these  two  Cluarters — Different  States  of  Society  the  Causes  of  this  Difference. — The 
Greatness  of  the  Power  acquired  in  Europe,  by  the  W^rongs  to  Labor. — The  practical 
Importance,  in  forming  a  System  of  Public  Economy  for  the  United  States,  of  consid- 
ering the  Difference  in  the  Cost  of  Money  and  Labor  in  Europe  and  America. — A 
Commercial  Principle  lies  at  the  Bottom  of  this  Difference,  and  controls  Results. 

CHAPTER  XX. — The  Claims  of  American  Labor  for  Protection. page  302 

Difference  in  the  social  Position  of  Labor  in  Europe  and  America, — It  is  a  Commercial 
Principle,  that  requires  the  Protection  of  American  Labor,  and  therefore  imperative. — 
The  Rule  of  graduating  Protection. — How  Foreign  Policies  bear  on  the  vulnerable 
Points  of  the  United  States. — British  Free  Trade  a  Protective  Policy. — The  Abatement 
of  Duties  in  Great  Britain  requires  Increase,  rather  than  Diminution,  in  the  United  States, 
because  it  is  made  for  Protection. — Importance  of  Skill  in  Public  Economy,  to  Amer- 
ican Statesmen. — The  Advantages  of  Free  Labor  over  Slave  Labor. — European  Labor 
in  a  like  Position  with  Slave  Labor, — The  best  Rule  for  Protection  is.  that  they  who 
ask  for  it,  should  have  it. — Adam  Smith's  Argument  for  Free  Trade,  is  One  for  Protec- 
tion.— He  concedes  and  begs  the  Question, — Adam  Smith  and  Daniel  Webster,  as  to  the 
Effect  of  increased  Investments  of  Capital  in  producing  Establishments,  on  Labor,  and 
on  the  Profits  of  Capital. — The  United  States  can  never  dispense  with  Protection,  so  long 
as  Money  and  Labor  here  cost  more  than  elsewhere. — The  Cry  of  "  Monopoly." — Dem- 
agogues. 


CONTENTS.  13 

CHAPTER  XXI.— BALA^CE  of  Trade page  322 

The  Balance  of  Trade  a  well  known  Principle  in  common  Life. — The  Efforts  made  to 
mystify  the  Subject. — Adam  Smith  and  liis  School  admit  the  Principle  unawares. — The 
only  Difficulty  is  an  imperfect  \  iew  of  the  Facts  that  belong  to  the  GLuestion. — The 
Difficulty  in  England  not  found  in  the  United  States,  and  is  now  removed  there. — Prac- 
tical Men  always  Riaht  on  this  Subject — Instance  the  London  Times. — Adam  Smith's 
"  Wherewithal.'' — The  Free-Trade  Economists  fail  to  distinguish  between  Money  as  a 
Subject  and  as  the  In.strument  of  Trade,  in  all  their  Reasonings  on  this  Question  — Adam 
Smith  lets  the  Cat  out  of  the  Bag,  by  an  Hypothesis. — The  Key  of  this  Hypothesis. — Ad- 
am Smith  makes  Loss  Evidence  of  Gain. — Joshua  Gee's  Position  and  Reasoning  as  a 
British  Economist. — He  the  BriiLsh  Oracle. — Hia  Policy  for  America — The  Coinage  of 
a  Nation  Evidence  of  its  Profitable  or  Unprofitable  Trade. — M.  Say's  Reasoning  on  the 
Balance  of  Trade. — Its  Absurdity — Adam  Smith  the  original  Author  of  this  Fallacy  — 
How  One  rides  a  Hobby. — A  Citizen  may  be  enriched  by  the  same  Act  that  subtracts 
from  the  Wealth  of  the  Nation. — So  of  a  Class  of  Citizens. 

CHAPTER  XXH. —  The  Mutual  Dependence  of  Agriculture,  Manufac- 
tures, AND  Commerce page  342 

These  three  are  a  natural  Family  of  Interests  in  the  United  States — Agriculture  ainne 
subjects  a  Nation  to  Dependence. — Adam  Smith  on  this  Point. — Adam  Smith  and  hia 
School  have  furnished  the  best  Refutation  of  their  own  Errors. — An  Argument  on  the 
indissoluble  Connexion  between  these  three  great  Interests. — The  "  Mercantile  and 
Agricultural  Systems,"  as  defined  by  Adam  Smith  and  others,  consiiiered. — There  is  no 
Foundation  for  this  Array  of  these  two  Systems,  as  opposed  to  each  other,  and  made  so 
much  of  by  some  of  the  Economists. — The  Importing  Merchants  favor  Free  Trade. — 
Smith's  and  Gee's  Description  of  this  Class  of  Traders. — The  Independent  Position  of 
every  Commercial  Transaction. 

CHAPTER  XXIII.— Protective  Duties  not  Taxes page  351 

The  Gain  of  Assumptions,  without  Proof,  to  one  Party,  and  the  Loss  to  the  other  by  con- 
ceding them. — The  whole  Controversy  tnnis  on  the  Proposiiiou  of  this  Chapter. — Popu- 
lar Instincts  on  this  Subject. — Duties  not  the  Cause  or  Measure  of  a  Change  in  Prices. — 
The  vast  and  comprehensive  Spheres  of  Influence  which  bear  on  this  Q,uestion — How 
they  all  tend  to  prove  that  Protective  Duties  are  not  Taxes. — The  Causes  Abroad  and 
at  Home,  which  produce  the  Effect. — A  Protective  System  adequate  for  all  Purposes 
of  Public  Revenue  in  the  United  States. — The  Commercial  Position  of  the  United  States 
will,  for  an  indefinite  Period,  require  Protection — An  Arrny  of  Facts  to  establish  the 
Proposition  of  this  Chapter,  with  Comments. — Reasons  of  the  Facts. — The  great  Misfor- 
tune of  conceding,' in  the  Technical  Use  of  Language,  that  Protective  Duties  are  Taxes. 

CHAPTER  XXIV. — An  American  Protective  System  a  Rescue  from  For- 
eign Taxation page  381 

The  Method  and  Rule  of  this  Argument,  as  laid  down  by  a  Public  Document  and  Jo.shua 
Gee. — A  Showing,  from  the  Principles  of  this  Rule,  and  by  Public  Documents,  of  the 
Foreign  Taxation  which  the  People  of  the  United  States  have  been  and  are  still  sub- 
jected to. — Adam  Smith's  and  M  Cnlloch's  Evidence  on  this  Point — Taxes  of  Foreign 
Nations,  of  whom  we  purchase,  enter  into  the  Prices  of  their  Products  to  us. — The  Prin- 
ciples of  the  Tariff  of  1846,  as  they  bear  on  this  Point. — Returns  of  British  Commerce 
as  compared  with  those  of  the  United  States. — The  Aggregate  of  Foreign  Taxes  paid 
by  the  United  States  since  1791. — A  Protective  System  the  sure  and  only  Way  of  Rescue 
from  Foreign  Taxation. 

CHAPTER  XXV. — Gains  of  Protection  and  Losses  by  Free  Trade,  .page  397 
The  everlasting  Objection. — The  Charm  of  Hypothesis,  as  compared  with  the  Inductive 
Mode  of  Reasoning — How  things  look  at  a  Distance. — Supplication  of  Europe  to 
America. — St.  George's  Spear  in  the  Throat  of  the  Dragon. — The  Aggregate  Loss  to  the 
United  States,  since  1791,  for  Want  of  a  Protective  System. — The  Loss  comprehends 
the  Use  of  the  Capital  in  all  Time. — The  EflTects  of  new  Arts  and  new  Pursuits  under 
a  Protective  System. — A  Variety  of  Facts  on  this  Point. 


14  CONTENTS. 

CHAPTER  XXVI. — The  Effects  op  a  Protective  System  on  the  Prices  of 
American  Labor page  410 

Consideration  of  the  contradictory  Averments  on  this  Point. — The  Facts  of  the  Case  — 
Statistics  bearing  on  the  Question. — The  Effect  of  Low  Wages  on  the  Character  of  the 
People. 

CHAPTER  XXVn. — The  Effects  of  a  Protective  System  on  the  Interests 
of  Agriculture page  418 

Not  true  that  Agriculture  has  no  Share  in  the  Benefits  of  a  Protective  System. — Facts  and 
Stali.-tical  Evidence  on  this  Point. — Breadstuff^,  in  ordinary  Seasons,  cheaper  in  Europe 
than  in  the  United  States. — The  Effect  of  Indirect  Protection  of  Agriculture. — Protec- 
tion of  Slave  grown  Staples — Slave  Labor  in  the  United  States  needs  Protection  more 
than  Free  Labor. — All  Nations  can  and  intend  to  supply  their  own  Mouths. — Great 
Britain  the  greatest  Exporter  of  Agricultural  Products,  of  any  Nation  in  the  world. — 
Evidence  of  William  Brown,  Esq.,  on  this  Point. — The  Importance  of  this  Fact  in  a 
System  of  Public  Economy. — Statistics  showing  that  Europe  is  Independent  of  the  Uni- 
ted States  for  Breadstuffs. — The  Problem  as  to  whether  An)erican  Indian  Corn  will  find 
a  permanent  Market  in  Europe. —  European  Agricultural  Labor  will  always  beat  Amer- 
ican Agricultural  Labor  in  Market,  because  of  its  Low  Price — The  Effect  of  a  Protec- 
tive System  in  sustaining  and  raising  Prices  of  Agricultural  Labor  and  Products. — 
Showing  of  the  Effects  of  certain  Items  of  the  Tariff  of  1846  on  the  Interests  of  Amer- 
ican Agriculture. 

CHAPTER  XXVIII. — The  Effects  of  a  Protective  System  on  the  Inter- 
ests of  Commerce  and  Navigation page  441 

Departments  of  Labor  interested  in  Navigation. — Ship  Builders,  Mechanics,  and  Bailors, 
all  require  Protection. — Sliip-Owners  require  it — What  would  be  the  Effects  of  abol- 
ishing our  Navigation  Laws — Navigation  and  Commerce  two  Interests. —  Siatisiical 
Proofs  of  the  different  Effects  of  Fvee  Trade  and  Protection  on  these  two  Interests. — 
The  Position  and  Interests  of  Importing  Merchants  hostile  to  the  Interests  of  the  Coun- 
try— Statistics  continued,  with  a  Variety  of  Fact.s,  mixed  with  Doctrine. — Commercial 
and  Reciprority  Treaties  all  bad,  as  proved  by  Experience. — Reciprocity  necessarily  em- 
bodies the  Principles  of  Free  Trade — Foreign  Commerce,  under  a  Protective  System, 
may  be  made  to  supply  all  the  Wants  of  Government,  without  taxing  the  People. 

CHAPTER  XXIX. —  The  Effects  of  a  Protective  System  on  the  Home 
Trade page  467 

The  Home  Trade  the  Basis  of  the  Fortunes  of  the  Country  — '•  Agriculture,  Manufactures, 
and  Commerce."  the  American  Coat  of  Arms — Home  Trade  has  always  made  the  For- 
tunes of  all  great  Continental  Nations — Insular  Nations  an  Exception. — The  Domestic 
Re.sources  of  the  United  States  incalculable. — We  have  all  Climates  deemed  good,  and 
all  Physical  Elements  of  Wealth  — The  Country  and  the  People  fitted  for  each  other. — 
The  Country  a  World  irultself — Care.  Work,  and  Frugality,  at  Home,  the  same  for  a 
Nation  as  for  a  Private  Individual. — "  Far-Fetched,  dear  Bought." — Home  Trade  does 
not  diminish,  but  enlarges  the  Amount  of  Commerce,  as  ten  Miles  is  only  Half  of  Twenty, 
and  can  be  gone  over  twice  for  once  of  the  latter. — The  thriving  Man  works  on  his  own 
Estate. — Difference  in  Results  of  Trade  between  Parties  to  a  Nation  and  Nations  as 
Parties. — The  Comparative  Amount  of  Home  and  Foreign  Trade — Statistics. — Amount 
of  the  Products  of  Labor  in  the  Country. — Amoant  of  Internal  and  Coasting  Trade. — 
Statistics. — Adam  Smith  on  Home  Trade. 

CHAPTER  XXX. — The  Effects  of  a  Protective  System  on  the  Cotton- 
Growing  Interest page  481 

The  Reasoning  of  a  Secretary  of  the  Treasury,  on  the  Cotton-Growing  Interest,  consid- 
ered.— The  Importance  of  this  Interest  as  compared  with  others. — The  "  Forty-Bale 
Theory  " — A  Variety  of  instructive  Statistics  on  the  Cotton  and  other  Interests  of  the 
Country. — The  Claims  of  the  Cotton  Interest,  as  being  one  of  superior  Political  impor- 
tance, examined. — The  Profits  of  Cotton  Growers  and  Manufacturers  compared — The 
Evidence  of  Mr.  Clay  and  the  "  Southern  Planter"  on  this  Point. — Table  of  Prices  of 


CONTENTS.  15 

Cotton  from  1790  to  1844. — A  Protective  System  more  important  to  the  Cotton-Growing 
Interest  than  to  any  other. — A  remarkable  and  decisive  Mode  of  Proof. — Action  of  a 
Convention  of  Mississippi  Cotton  Planters  on  the  Subject 

CHAPTER  XXXI. — The  Principles  of  a  Tariff  as  they  respect  the  Ob- 
jects OF  Duties  and  the  Modes  of  Collecting  them  ....  I. page  502 

An  American  Economist  of  the  present  Time  exposed  to  the  Charge  of  Political  Partisan- 
ship.— He  is  obliged  to  examine  public  Measures  as  Facts. — Tlie  Principles  of  the 
"  Revenue  Standard"  examined. — A  Tariff  not  a  Revenue  Measure,  except  inciden- 
tally.— The  Customhouse  System  inconsistent  with  Free  Trade. — Direct  Taxation  and 
Free  Trade  go  together. — No  such  Thing  as  Incidental  Protection. — Minimum  Duties 
and  their  Eft'eots.— Specific  Duties. — Ad  Valorem  Duties. — History  and  ES'ects  of  these 
Different  Modes  of  Duties. — Proofs  in  Point. 

CHAPTER  XXXII.— The  Tariff  of  1846 page  516 

The  Tariff  of  1846  a  Surrender  and  Abandonment  of  the  Principles  of  Protection. — Popular 
Instincts  on  this  Subject. — It  takes  Years  for  the  Proof  of  a  new  Tariff  Policy. — 
Probable  Result  of  the  Tariff  of  1846.— A  Table  showing  the  Effects  of  the  Tariff  of 
1846  on  American  Labor  and  Arts. — Remarks  upon  this  Table. — The  Effect  of  Auction- 
Sales  of  Imports  on  American  Labor  and  Trade. — Importance  of  harmonious  Legisla- 
tion between  Federal  and  State  Authorities  for  Auction  of  Imports. — The  Discrimina- 
tions of  the  Tariff  of  1846  against  American  Industry  and  Labor. — Tables  in  Proof. — 
Object  of  the  Anti-ComLaw  League  of  England — False  Reasoning  of  Free  Trade 
on  the  Effects  of  the  Famine  in  Ireland  and  of  the  short  Crops  of  Europe. 

CHAPTER  XXXIII.— The  Contingent  Destiny  of  the  United  States.  .530 

The  Contingencies  of  Free  Trade. — Review  of  our  Commercial  History,  as  it  discloses 
Contingencies. — What  makes  a  Sound  Currency. — As  a  Man  that  fails  frequently  in 
Business  can  not  get  rich,  so  neither  can  a  Nation. — The  possible  Destiny  of  the  Country, 
under  a  Protective  System,  grand  and  glorious. — Free  Trade  devours  All,  and  then  eats 
up  Itself. 


PUBLIC    ECONOMY, 


FOR 


THE    UNITED    STATES. 


CHAPTER    I. 

PRELIMINARY    REMARKS. 

The  Task  attempted  in  this  Work — The  Doctrine  of  Free  Trade  Economists  not  a  Science. 
— Ti)is  false  Pietension  a  Stolen  Shield — On  common  Ground,  Free-Trade  Economists 
bave  done  some  Good. — This  Work  a  System  for  the  United  States. — The  New  Features 
of  thisW'oik  not  Novelties. — The  proper  Functions  of  Hypothesis. — Free  Trade  Econ- 
omists have  made  an  unjustifiable  Use  of  Hypothesis — It  leads  to  no  Re.iult. — Mill's, 
Compte's.  Newton's,  and  Reid's  Views  of  Hypothesis — Reasons  for  the  limited  Scope 
of  tins  Work. — Reasons  for  changing  the  name  of  the  General  Subject. — Politics  and 
Political  Economy. — The  Comprehensiveness  of  this  Work,  and  the  Unity  of  its  Plan. 

It  will  be  seen  that  the  author  of  this  work  has  had  to  confront 
authorities  of  no  mean  consideration  —  authorities  which,  strange 
as  it  may  seem,  have  occupied  the  theatre  of  debate  on  the  leading 
topic  of  these  pages,  for  nearly  a  century,  without  ever  having  been 
encountered,  face  to  face,  in  their  main  positions.  It  has  been 
claimed  for  them,  that  they  could  not  be  answered  ;  that  they  had 
settled  the  question  ;  and  that,  henceforth,  time  only  was  required 
to  establish  the  universal  triumph  of  Free  Trade. 

Though  facts,  in  abundance,  had  been  arrayed  against  these  pre- 
tensions, nevertheless  they  seemed  still  to  command  attention  and 
respect.  The  doctrine  of  Free  Trade  had  taken  up  the  position,  and 
asserted  the  prerogatives,  of  a  science,  composed,  in  all  that  be- 
longed to  it  properly,  of  uniform  propositions  in  all  places,  and  in 
all  time;  from  the  deductions  of  which,  conceding  the  claim,  there 
was  no  appeal.  But  its  claim  to  be  ranked  among  the  sciences, 
was  a  stolen  shield.     So  long  as  such  a  weapon  of  defence  was 


PRELIMINARY    REMARKS. 


awarded  to  it  by  consent,  it  was  impossible  to  reason  with  or  against 
it,  inasmuch  as  a  deduction  of  science  is  justly  regarded  as  too  for- 
midable for  oppugnation.  No  other  answer  was  required  from  them, 
except  this  :  It  is  contrunj  to  the  theory.  The  theory,  averred  to 
be  a  science,  was  the  charm  that  dissolved  all  arguments  —  the 
stronghold  within  which  a  retreat  could  always  be  covered.  But 
this  claim  will  be  found  to  be  untenable  ;  and  divested  of  this,  there 
is  nothing  left  to  it  but  certain  loose  reasonings,  in  the  shape  of  em- 
pirical laws  —  nothing  but  the  ingenious  fabrications  of  great  abili- 
ties, based  on  hypotheses,  and  forced  into  currency  by  the  authority 
of  great  names. 

The  audior  of  this  work  has  no  objection  to  the  use  of  the  term 
science  in  this  application  ;  nor  does  he  deny,  but  on  the  contrary 
maintains,  that  the  elements  of  public  economy  embody  the  mate- 
rials of  a  science  of  a  very  high  order  and  of  great  importance.     But 
-  t        it  is  one  thing  to  have  the  elements  of  a  science  in  hand,  and  an- 

-4^'  other  to  have  constructed  the  science.     Nor  do  we  mean  by  this  to 

admit,  that  the  Free-Trade  economists  have  the  elements ;  it  will  ap- 
pear in  the  next  chapter  that  they  have  not.     We  have  there  marked 
'  A  ^-    ^.    the  distinction  between  empirical  laws  and  those  of  a  science,  and 

^  '      '■         shown  that  the  doctrines  of  Free  Trade  are  composed  entirely  of  the 
v-      former.      By  arrogating  the  name  and  authority  of  a  science  for 

>/\~  '•'  '  '  their  dogmas,  the  Free-Trade  economists  had  interposed  an  effectual 
bar  to  investigation  by  scientific  rules,  and  covered  themselves  with 
an  impenetrable  shield,  in  the  presence  of  all  who  conceded  the 
claim.  It  will  be  found,  that  the  ejection  of  these  pretenders  from 
this  stronghold,  opens  the  whole  field  anew  to  fresh  explorations, 
and  that  the  old  charts,  proved  to  be  erroneous  in  very  important 
particulars,  must  be  used  with  extreme  circumspection.  It  is  not 
denied,  that  the  European  economists  of  the  Free-Trade  school  have 
done  some  service,  where  they  were  at  home,  in  a  field  directly 
under  their  eye  ;  or  that  they  have  recognised  and  settled  princi- 
ples which  are  common  to  all  parts  of  the  world,  and  to  every  state 
of  society.  But  it  is  not  allowed,  that  they  were  competent  to  lay 
down  rules  for  countries  and  states  of  society  with  which  they  had 
no  acquaintance,  and  of  the  peculiarities  of  which  they  had  not  the 
faintest  conception. 

With  these  views  of  the  standard  lights  of  a  science,  "falsely  so 
called,"  the  author  has  endeavored  to  construct  a  svstem  of  econo- 
my  for  the  United  States,  and  to  show  wherein  the  principles  of 
European  economists  are  entirely  inapplicable  here.     He  has  not 

A  '     '    •  ,  /^ 


en- 


f-^x,A^    o  I  u.,    ■      .  '■^-  n  /■. 


/<        A 


1. 


^i 


^  ^     a"      \tf  ^  f  PRELIMI.VARY    iliJIVIAUKS.  * 

taken  up  new  positions,  or  started  from  new  points,  or  said  new 
things,  merely  for  the  sake  of  noveUy.  He  has  availed  himself  of 
helps,  where  he  could  find  them ;  but  he  has  been  forced  to  exe- 


\ 


cute  his  own  conceptions,  and  to  carry  out  his  plan,   independent     t^     ** 
of  all  authority.    Yet  scarcely  a  thought  will  be  found  within  these 
pages  which  has  not  been  common  property  with  many  minds,  and     ^ 
which  the  intelligent  reader  will  not  probably  recognise,  though  it   ^    J 
should  be  the  first  time  he  ever  saw  it  reduced  to  form,  and  ad-  '.', 

justed  in  a  satisfactory  place.    So  far  is  the  author  from  being  am-  ^     ^ 
bitious  to  produce  surprise,  that  he  would  think  his  labor  lost,  if  he    ^    3      T" 
had  done  so.     He  that  advances  things  entirely  new,  and  before    *    C      J 
unthought  of,  on  a  great  theme,  though  they  be  true,  is  probably  ''"■      ^ 

doomed  to  pass  from  the  stage  before  they  will  be  appreciated. 
Feeling  the  present  importance  of  his  subject,  the  author  has  de- 
sired to  be  understood  and  appreciated  now — at  first  sight;  and 
he  has,  therefore,  studied  not  to  make  statements  which  would  re-     3     ^ 
quire  study  in  others.     He  does  not  believe  in  the  usefulness  of  ,  j 

anything  on  this  subject,  which  is  not,  to  a  very  great  extent,  com-  "  '  A 

mon  property,  as  the  result  of  unavoidable  experience  and  observa-       ^  ** 
tion.     He  does  not  consider,  that  what  he  has  done  that  may  appear     '^    *" 
to  be  new,  is  really  new  in  most  men's  minds  ;  but  only  in  works         "^ 
of  this  kind.     The  very  ground  of  his  rejection  of  all  models  and  . 
authorities  coming  in  the  way  of  his  convictions,  is  that  of  his  con- 
fidence in  the  common  sense  of  mankind,  above  which  he  would  _ 
not  willingly  soar,  and  beyond  the  range  of  which  he  would  not 
venture,  so  long  as  he  desires  to  be  useful. 

The  author  has  been  forced  to  observe,  that  hyporhcsis  is  the 
beginning,  the  middle,  and  the  end  of  the  reasoning  of  Free-Trade 
economists ;  that  is  to  say,  they  have  no  other  proof  of  the  truth 
of  their  doctrine,  than  its  assumption.  This  being  a  very  im-  rhl^yf,_  / 
portant  point,  it  is  proper  here  to  say  a  few  words  on  the  nature 
and  functions  of  hypothesis,  in  scientific  investigations.  "An 
hypothesis,"  says  John  Stuart  Mill,  in  his  system  of  logic,  "  is 
any  supposition  which  we  make,  in  order  to  deduce  from  it  con- 
clusions in  accordance  with  facts  which  are  known  to  be  real.  .  . 
There  are  no  other  limits  to  hypothesis,  than  those  of  the  human 
imagination.  .  .  Hypotheses  are  invented  to  enable  the  deduc- 
tive method  [of  reasoning]  to  be  earlier  applied  to  phenomena. 
In  order  to  discover  the  cause  of  any  phenomena,  by  the  deductive 
method,  the  process  must  consist  of  three  parts  :  induction,  ratio- 
cination,   and   verification.    .    .    Now,    the    hypothetical    method 


^fuL.'    Oyy,e^\^  ^^M^VVs^'^    ^^"f^'  '  -t^--^-rtc-v 

20  *  PRELIMINARY    REMARKS.  />>-!' 

suppresses  the  first  of  these  three  steps,  to  wit,  induction,  and 
contents  itself  with  the  other  two  operations,  ratiocination  and  ver- 
ification ;  the  law  which  is  reasoned  fronn  being  assiimcd,  instead 
of  proved.^^ 

Doubtless,  the  hypothesis  of  Free  Trade  would  beentidedto  the 
position  of  a  theory  or  science,  if,  by  the  force  of  its  ratiocination, 
it  had  ever  arrived  at  the  end  in  view,  or  at  the  third  step  above 
stated  by  Mr.  Mill,  to  wit,  verification.  But  here  is  the  point 
where  it  always  fails,  and,  therefore,  remains  in  statu  quo,  an 
hypothesis  still ;  or,  rather,  is  actually  disproved  by  a  counter 
verification,  in  the  same  manner  as  the  earlier  hypotheses  of  the 
laws  of  the  solar  system,  and  of  the  material  universe,  have  been 
disproved,  by  the  verification  of  other  and  more  correct  hypotheses. 
Hypothesis  is  worthy  of  no  respect,  except  as  it  is  verified  by 
facts.  It  may  be  admitted,  transiently,  for  a  purpose;  but  when 
the  purpose  fails  of  verification,  it  falls  to  the  ground;  and  when 
a  counter  verification  is  made  out,  it  is  disproved.  Such  has  been 
the  result  in  the  trial  of  the  hypothesis  of  Free  Trade. 

"  It  appears,"  says  Mr.  Mill,  above  cited  as  the  latest  and  best 
logical  authority,  "  to  be  a  condition  of  a  genuinely  scientific  hy- 
pothesis, that  it  be  not  destined  always  to  remain  an  hypothesis; 
but  be  certain  to  be  either  proved  or  disproved  by  that  comparison 
with  observed  facts,  which  is  termed  verification.  ...  If  the 
supposition  accords  with  the  phenomena,  there  needs  no  other 
evidence." 

The  substance  of  M.  Comte's  reasoning  on  this  point — and 
he  is  allowed  to  be  one  of  the  greatest  philosophers  of  the  age  — 
is,  that  "  we  arrive,  by  means  of  hypothesis,  to  conclusions  not 
hypothetical."  This  is  the  true  and  only  legitimate  function  of 
hypothesis  in  scientific  investigations,  and  when  the  third  step  of 
the  deductive  method  fails,  to  wit,  verification,  which  is  the  only 
object,  and  the  only  justification  of  assuming  the  first,  in  the  shape 
of  hypothesis,  then  the  hypothesis  falls  to  the  ground.  "  It  is  not 
destined,"  as  Mr.  Mill  says  above,  "always  to  remain  an  hy- 
pothesis ;"  but  must  either  be  verified,  which  transforms  it  into  a 
science,  or  part  of  a  science ;  or  be  rejected,  for  want  of  verifica- 
tion, as  worthy  of  no  respect. 

This  is  precisely  the  fate  of  the  Free-Trade  hypothesis,  which, 
though  it  has  never  yet  got  any  farther  than  the  original  assump- 
tion, to  irrove  itself  bu  itself,  has  been  dignified  with  the  name  of  a 
science.      It  dispenses  with  the  syllogism  altogether,  without  which 


(X. 


J*/ r  <r//-i.r  C  .    /  ^^tf-iL..^ 


•     PRELIMINARY    REMARKS.  21 

no  result  can  ever  be  arrived  at  by  deduction.     It  halts  for  want  of  a 
X.      second  term  in  the  train  of  its  reasoning,  and  leaps  the  chasm  to  a 
forced  conclusion. 

It  is  admitted,  that  hypothesis  is  a  legitimate  resort,  as  a  mode 
of  reasoning  backward  from  effect  to  cause,  for  the  purpose  of 
ascertaining  a  cause  ;  or  rather,  perhaps,  we  should  say,  in  assu- 
ming a  more  or  less  remote  antecedent  as  a  law,  in  order  to  ascertain, 
by  scrutiny,  whether  it  be,  in  fact,  a  law  of  causation  in  relation  to 
a  given  effect;  and  that,  in  this  way,  some  of  the  most  important 
truths  in  science,  as  in  astronomy  for  example,  have  been  estab- 
lished. One  of  the  earliest  hypotheses  of  the  universe,  was,  that 
the  earth  rested  on  the  back  of  a  huge  elephant,  and  that  the  ele- 
phant stood  on  the  back  of  a  great  tortoise.  This  is  an  hypothesis ; 
and  if  the  facts  observed  had  been  found,  on  scrutiny,  to  agree 
with  it,  it  would  have  stood.  Another  later  hypothesis  was,  that 
the  sun  and  heavenly  bodies  move  around  the  earth  every  twenty- 
four  hours.  Next  to  that  was  discovered  the  true  hypothesis,  viz., 
that  the  earth  turns  daily  on  its  own  axis.  This  agrees  with  ob- 
servation of  facts;  in  other  words,  is  verified,  and  has,  therefore, 
been  sustained.  Sir  Isaac  Newton  invented  a  series  of  hypotheses 
by  which  the  laws  of  gravitation,  and  other  phenomena  of  the 
universe,  were  verified,  as  now  received  in  science.  Hence  a 
perfect  and  scientific  theory  of  the  material  universe.  Such  is  the 
use  and  intent  of  hypothesis,  viz.,  to  arrive  at  the  cause  of  an  effect, 
,  and  at  the  laws  by  which  effects  are  controlled.     In  this  way  hy-      .  . 

pothesis  ministers  to  the  ends  of  science.  But  to  stop  at  hypothesis, 
and  call  it  science,  as  the  Free-Trade  economists  do,  is  precisely  the 
same  as  to  claim  our  belief,  that  the  earth  rests  on  the  back  of  an 
elephant.  To  erect  an  hypothesis,  and  then  to  force  conclusions 
from  it,  is  utterly  inadmissible.  Above  all,  when  the  conclusions 
are  at  variance  with  facts,  the  hypothesis  is  falsified.  This  is  pre- 
cisely the  position  and  fate  of  the  Free-Trade  hypothesis.  It  stands 
alone,  unsupported.  This  is  all  the  authority  which  the  doctrine 
has,  and  is  the  very  reason  why  it  should  be  abandoned.  It  dis- 
appoints the  aim  of  hypothesis,  which  is  to  find  a  position  to  account 
for  facts.  When  that  fails,  the  hypothesis,  however  ingenious  and 
beaudful  to  look  at,  is  a  bubble,  and  is  worth  no  more.  It  will  be 
seen,  in  the  progress  of  this  work,  that  the  Free-Trade  doctrine  is 
precisely  of  this  character,  not  in  harmony,  but  in  conflict,  with 
facts ;  and,  therefore,  that  it  is  not  simply  good  for  nothing,  but 
must  prove  fatal  in  practice. 

^r^-^'^^  '^'uyd.  g^^t*jri  i-tMT^  ■  v^xyt-  M'v-^ 


-\- 


22  PllELIMIXARY    UEMARKS. 

•Sir  Isaac  Newton  says:  "No  more  causes, .  nor  any  other 
causes,  of  natural  effects,  ought  to  be  admitted,  but  such  as  are 
both  true  and  sufficient  for  explaining  phenomena."  "  This,"  says 
Dr.  Reid,  in  his  Essays,  "is  the  golden  rule.  It  is  the  true  and 
proper  test  by  which  what  is  sound  and  solid  in  philosophy,  may 
be  distinguished  from  what  is  hollow  and  vain."  Another  form  of 
this  rule  of  Sir  Isaac  Newton  is,  that  phenomena  or  facts  are  the 
test  of  an  hypothesis;  and  this  form  more  particularly  applies  to 
the  argument  of  this  work,  though  it  can  not  fail  to  be  appreciated, 
by  intelligent  minds,  in  any  form. 

On  this  Newtonian  rule,  Dr.  Reid  remarks  :  "  If  a  philosopher, 
therefore,  pretend  to  show  us  the  cause  of  any  natural  effect,  whether 
relating  to  matter  or  to  mind,  let  us  first  consider,  whether  there  be 
sufficient  evidence  that  the  cause  he  assigns  does  really  exist.  If 
there  be  not,  reject  it  with  disdain,  as  a  fiction  which  ought  to  have 
no  place  in  genuine  philosophy.  If  the  cause  assigned  really  exist, 
consider,  in  the  next  place,  whether  the  effect  it  is  brought  to 
explain,  necessarily  follows  from  it.  Unless  it  have  these  two 
conditions,  it  is  good  for  nothing." 

Sir  Isaac  Newton  would  not  venture  on  hypothesis  beyond  what 
could  be  proved  by  facts,  or  presume  to  assert  on  mere  hypothesis, 
the  cause  of  gravitation,  or  the  cause  of  a  cause  he  had  discovered. 
He  says:  "The  reason  of  these  properties  of  gravitation,  I  have 
not  been  able  to  deduce  from  phenomena  ;  and  I  am  not  a  fabricator 
of  hypotheses.  Hypotheses,  whether  in  metaphysics,  or  physics, 
or  mechanics,  or  occult  qualities,  have  no  place  in  experimental 
philosophy;"  that  is,  as  unverified  rules.  Much  less  should  njere 
hypothesis  be  permitted  to  decide  questions  in  public  economy. 

Some  persons  may,  perhaps,  at  first  sight,  think  it  was  unneces- 
sary to  carry  this  debate  through  an  entire  work  on  public  economy. 
But  it  will  be  found,  that  there  is  no  interest  of  the  country,  or  of 
any  section  of  it,  or  of  any  party  or  person  in  it — the  merchant 
engaged  in  foreign  trade,  perhaps,  excepted  —  to  which  an  Amer- 
ican protective  system,  is  not  vital ;  and  even  the  merchant,  adapt- 
ing his  business  to  such  a  system,  when  once  established,  would 
find  it  to  be  more  for  his  advantage  in  the  end,  as  shown  in  this 
work.  Anything  that  does  not  come  within  the  range  of  this  de- 
bate, is  believed  by  the  author  to  be  of  no  material  consequence  in 
a  system  of  public  economy  for  the  United  States,  and  although 
there  are  many  details  of  the  system,  not  specifically  brought  under 
consideration  in  this  work,  all  of  any  importance  are  comprehended 


PllELIMINARY    REMARKS.  23 

in  the  questions  discussed.  It  would  require  volumes  to  make  a 
perfect  work  on  this  subject.  In  the  author's  view,  there  was  an 
exigency  of  the  time  —  an  exigency  produced  by  nearly  a  century's 
growth  of  systematic  error,  which  will,  perhaps,  require  an  equal 
period  to  dissolve  and  dissipate  it  —  an  exigency  which  might  well 
absorb  a  Hir  more  extended  effort  than  the  one  now  submitted,  and 
talents  of  an  order  and  power  to  which  the,,  author  can  make  no 
pretensions.  To  meet  this  exigency  is  the  main  design  of  this  work. 
We  have  not  rejected  the  usual  title  of  ^^jioliflajf  economy"  in 
application  to  this  work,  and  to  the  general  subject,  because  we 
proposed  to  enter  a  different  field  ;  nor  because  the  topic  and  argu- 
ment have  no  relation  to  political  society  ;  but,  chiefly,  because  the 
term,  "political,"  has  been  so  much  lowered,  in  this  country,  by  /  ii  g 
the  rude  agitations  of  what  are  commonly  called  "  politics,"  that  ^  '  ' 
we  do  not  think  the  term  now  so  well  comports,  among  us,  with  *  ■>  ^ 
the  dignity  of  our  theme,  as  it  did  generally  throughout  the  world, 
when  first  employed  in  this  application.     It  is,  therefore,  in  part,  a  _ 

matter  of  taste,  that  has  led  us  to  this  partial  change  of  name  for 
such  a  work  and  subject;  though,  we  think,  it  will  be  found  to  be 
a  felicitous  change  in  other  respects  than  that  of  being  a  rescue 
from  associations  not  always  pleasant.  The  word,  "  public,"  is 
the  exact  counterpart  of  the  word,  "  private;"  and,  it  is  believed, 
that  one  can  not  have  proceeded  far  in  this  work,  without  feeling, 
that  there  is  a  much  greater  fitness  in  the  use  of  the  former  term, 
than  '■^  jmlitical,''^  in  such  an  application,  because,  in  no  case,  will       ,  f 

there  be  a  sense  of  incongruity,  when  the  former  is  thus  employed  ;  ^W  ^^  *"' 
whereas,  this  feeling  will  frequently  arise  in  such  an  application  of  ■ 

the  latter.  It  is  chiefly  "  yublic^''  economy  with  which  we  have 
to  do,  in  a  work  of  this  kind  ;  and  if  it  is  also  "political,"  in  some  — " — 
respects,  it  is  not,  perhaps,  unqualifiedly  so  ;  or  allowing  even  that  '^^^^5^,!^ 
it  is,  still  objections  lie  against  the  latter,  on  account  of  its  frequent 
prostitution  to  violent  debates  and  low  controversies,  which  can 
never  lie  against  the  former.  M.  Say  protests  seriously  and  ear- 
nestly against  a  necessary  connexion  of  "  politics"  with  "  political 
economy  ;"  and  gives  for  reason,  that  "  wealth  is  independent  of 
poUtical  organization."  We  think,  however,  his  protest  is  without 
foundation,  and  his  objection  without  force.  The  economist  is  the 
school-master,  and  the  statesman  is  the  practical  operator.  These 
terms  are  correlatives, —  and  the  latter,  properly  qualified,  as  much 
supposes  a  pupilage  under  the  former,  as  engineering  supposes  an 
acquaintance  with  the  science. 


84  PRELIMINARY    REMARKS. 

But  the  term  "  public,"  all  things  considered,  is  exactly  the 
word  for  this  place,  always  expressing  and  comprehending  all  that 
is  wanted,  and  never  suggesting  an  irrelevant  idea.  It  has,  more- 
over, the  advantage  of  always  expressing  a  relation  to  "private" 
economy,  which,  as  will  be  found,  the  case  requires,  and  which  the 
term  "  political,"  does  not  necessarily  denote,  nor  very  naturally 
suggest.  It  is  agreed  by  all  economists,  that  the  wealth  of  a  nation 
is  chiefly  composed  of  the  aggregate  wealth  of  all  its  individuals  ; 
and  by  some,  this  is  affirmed,  though  we  think  incorrectly,  without 
qualification.  For  example,  all  public  property  is  an  exception  ; 
so  also  the  means  of  wealth,  which  a  nation  possesses,  as  a  political 
corporation,  which,  in  some  cases,  are  great  and  comprehensive, 
and  may  be  justly  styled  the  capital  of  its  position.  It  is  true,  that 
all  these  ought  to  minister  to  private  wealth,  and  if  properly  hus- 
banded, will  do  so.  Nevertheless,  they  do  not  fall  within  the 
aggregate  of  private  inventories.  There  is,  however,  always,  an 
appropriate  relation  expressed  in  the  apposite  terms  of  "  public" 
and  "  private"  economy,  which  would  not  be  so  uniformly  con- 
veyed by  the  substitution  of  the  word  "political,"  for  that  of 
"  public  ;"  and  the  best  of  it  is,  that  the  term  "  public,"  in  such  a 
use,  always  conveys  the  idea  required,  as  it  is  invariably,  in  every 
practical  view,  the  counterpart  of  "  private." 

But  there  is  yet  a  much  more  important  and  vital  reason  for 
using  the  term  "  public,"  instead  of  "  political,"  in  this  application 
—  a  reason  which  involves  a  fundamental  principle  in  the  general 
argument,  viz.,  that  there  can  not  be  two  kinds  of  economy,  and 
that  the  principle  is  the  same  in  public  as  in  private  economy,  the 
former  differing  from  the  latter  only  in  the  comprehensiveness  of  its 
interests.  The  absurdity  of  applying  one  set  of  rules  of  economy 
to  a  given  number  and  amount  of  given  interests,  having  the  same 
relations,  while  they  are  called  private,  because  they  belong  to  one 
person,  and  of  applying  a  different  set  of  rules,  because  the  same 
interests  belong  to  many  persons,  and  are  therefore  called  public, 
must  be  apparent  to  all.  The  man  who,  under  a  good  system  of 
economy,  and  beginning  with  one  interest,  has  grown  ricli,  and 
brought  under  his  charge  many  interests,  managing  them  all  with 
skill,  and  by  rules  which  he  has  found  profitable  by  experience, 
would  be  very  unwise,  probably  would  be  ruined,  by  changing  his 
system.  That  which  he  has  found  to  be  economy,  is  economy, 
and  nothing  else.  He  can  no  more  alter  the  principle,  than  he  can 
make  right  wrong,  and  wrong  right.    He  is  as  much  compelled,  in 


■P1 


C 


Pi'iE  LI  MI.\  A  HiT     KEMARKS.  25 

his  commercial  relations,  to  one  uniform  course,  under  the  same 
circumstances,  in  order  to  prosper,  as  in  his  social  relations  in  order 
to  be  happy.  The  multii)lication  and  diversity  of  his  interests  do 
not,  in  the  least  degree,  affect  his  principles  of  economy.  Besides, 
it  may  easily  be  conceived,  that  a  single  person  may  have  even  a 
greater  diversity  and  a  greater  amount  of  interests  than  a  state. 
Whatever  is  economy  to  him  is  economy  to  the  state,  and  what- 
ever is  economy  to  the  state  is  economy  to  him,  for  given  interests 
in  given  circumstances.  And  yet  it  will  be  found,  that  Free  Trade  7 
prescribes  a  veiy  different  species  of  economy  for  the  state,  from  J 
that  which  all  experience  has  prescribed  to  private  persons. 

Some  persons,  probably,  will  think  this  work  a  very  incomplete 
system,  as  no  notice  is  taken  of  numerous  topics,  naturally  falling 
within  the  range  of  public  economy,  and  which  are  usually  consid- 
ered in  such  works.  In  answer  to  this,  the  author,  after  pleading 
guilty  to  this  sin  of  omission,  would  say,  that  he  had  a  single  aim- 
in  the  conception  and  execution  of  his  task,  the  accomplishment 
of  which,  he  found,  would  swell  it  to  as  large  a  volume  as  might 
be  expedient  for  such  a  publication,  and  that  another  of  equal  ex-^ 
tent  would  be  required  to  do  justice  to  all  the  topics  which  might 
be  considered  as  belonging  to  the  general  subject.  That  aim  was^ 
to  show,  as  well  as  he  could,  the  merits  of  the  Protective  and  Free- j 
Trade  systems,  respectively,  as  they  apply  to  the  United  States.  It 
will  be  found,  that  the  author  has  never  deviated  from  this  line  of 
argument.  Adhering  to  this  purpose,  it  will  also  be  seen,  that  the 
work  has  a  unity  of  plan,  whi(  h  is  usually  regarded  as  one  of  the 
most  important  attributes  of  design  in  all  productions  of  art,  of  which 
literary  composition  must  be  allowed  to  be  one,  and  not  the  least  in 
general  consideration.  The  author  is  of  opinion,  that  the  setdement, 
for  the  United  States,  of  the  question  debated  in  these  pages,  is  one 
of  the  most  desirable,  and  will  be  one  of  the  most  important  events, 
which  remain  to  be  achieved  in  the  progress  of  the  country  ;  and 
that  all  minor  questions  of  public  economy,  arising  out  of  our  do- 
mestic condition  and  interests,  can  hardly  fail  to  go  right,  if  thig 
goes  right.  He  has,  therefore,  devoted  himself  to  the  prosecution 
of  this  great  argument,  and  kept  within  its  limits.  As  the  title  of 
his  work  proclaims,  it  is  for  the  United  States,  considered 
chiefly  in  their  foreign  commercial  relations  and  interests,  as  they 
are  connected  with  and  bear  upon  domestic  interests. 


26  THE    NEW    POINTS    OF    THIS    WORK.  , 

^  CHAPTER    II. 

THE    NEW    POINTS    OF    THIS    WORK. 

What  is  meant  by  these  New  Points. — The  Firet:  Definition  of  the  General  Subject  — 
Importance  and  Influence  of  Definitions. —  Public  Economy  not  heretofore  reduced  to  a 
Science — The  Definition  here  given  of  the  Subject  is  consistent  with  a  Science. — It  res- 
cues the  Subject  from  an  embarrassed  Condition. — The  Free-Trade  Theory  composed  of 
uniform  Propositions. — The  Exact  Sciences. — All  Sciences,  when  fully  constructed,  are 
necessarily  exact — Science  appertains  to  all  Subjects — The  Science  of  Socinlo^y,  as 
announced  by  M.  Compte,  in  an  imperfect  State. — John  Stuart  Mill's  Definition  of  Sci- 
ence.— Why  the  Science  of  Sociology  is  Imperfect. — Mr.  Mill,  a  Free  Trader  by  Sym- 
pathy, has  demolished  the  Theory  by  Logic. — Citations  of  a  remarkable  Character  from 
Mr.  Mill — What  they  prove. — Private  and  Public  Economy  compared. — Napoleon  on 
this  Subject. — Common  Principles  in  Systems  fundamentally  different. — How  our  Defi- 
nition affects  the  General  Argument. — Empirical  Laws  defined  — Public  Economy,  down 
to  this  Time,  lies  scattered  over  the  Field  of  Empirical  Laws,  and  has  not  been  reduced 
to  a  Science. — ^The  Free  Trade  Hypothesis  belongs  to  a  Category  of  Empirical  Law8 
incapable  of  being  reduced  to  a  Science — The  recognised  Canons  of  Experimental  In- 
duction, as  laid  down  by  Logicians,  fully  sustain  the  Claims  of  Protection  against  those 
of  Free-Trade,  and  install  the  Former  in  the  Position  of  a  Science. — How  to  apply  these 
Canons  to  this  Subject. — A  Science  can  not  be  made  out  of  the  Laws  of  Public  Economy, 
except  for  one  Nation,  each  by  It.self — The  True  Position  of  Labor. — Labor  robbed  of 
its  Rights  by  a  False  Po.sition  in  Public  Economy. — Protective  Duties  not  Taxes  in  the 
United  States,  and  a  Rescue  from  Foreign  Taxation — How  Public  Economy  is  affected 
by  different  States  of  Society. — New  Points  in  regard  to  Money  and  a  Monetar}-  System. 
— The  Reasons  for  Free  Trade,  with  the  People,  are  Reasons  for  Protection. — The  In-^ 
stitution  of  Properly. —  The  Destiny  of  Fieedom  not  yet  achieved — The  Protective  Prin- 
ciple identical  with  that  of  the  American  Revolution. — Free  Trade  in  Great  Britain  notv'^ 
based  on  Science,  but  on  Public  Policy. — Rise  and  Progress  of  the  Free  Trade  Theory. 
— Definition  of  Freedom — An  Ameiican  System  of  a  Peculiar  Character. — Free  Trade 
identical  with  Anarchy. — Protection  can  never  be  dispensed  with,  in  any  siipposable 
Perfection  of  American  Arts. —  Agricultural  Labor  and  Products  in  the  Guise  of  Manu- 
factures.— Not  two  Kinds  of  Economy. 

By  the  new  points  of  this  work,  it  is  not  "meant,  that  all  specified 
as  such  are  entirely  so,  though  many  of  ihein  are  ;  but,  on  account 
of  the  importance  given  to  their  position,  as  compared  with  the 
slight  notice  taken  of  them  in  other  works  of  this  kind,  it  is  tiunight 
proper  to  present  them  as  new.  Many  of  them,  as  will  be  seen, 
involve  fundamental  and  all-pervading  principles,  such  as  have  not, 
heretofore,  been  incorporated  in  works  of  public  economy.  The 
announcement  of  a  few  of  the  most  prominent  of  these  points,  in 
this  place,  may,  perhaps,  serve  the  purpose  of  suggesting  what  in- 
fluence and  effect  they  are  entitled  to  have  on  the  general  argu- 
ment. 

1.  The  first  we  would  notice  is  our  definition  of  the  subject : 
Public  economy  is  the  application  of  knowledge  derived  from  exjieri- 


i-/  '^.-.,  ,,  <  ^   ' '     ^^' 


^     ^^k/7(lAy/-^  .^^"-^^^     -^ 


/ 


HE    NEW    POINTJ(g^OF    THIS    WflHRK.    ,^/^    ^^      27 

c;2ce  ^0  rt  gwen  posi/ion,  to  given  interesis,  and  to  given  imtitutions  £^0 
of  an  independent  state  or  nation,  for  the  increase  of  yublic  and  pri-  >^V 
vate  wealth.  " 

In  all  scientific  investigations,  definitions  discharge  the  functions 
of  a  finger-post,  of  a  door  of  access  to  the  field,  of  marking  the 
boundaries  of  that  field,  and  of  a  glance  view  of  the  whole  ground. 
The  definition  is  the  controlling  law  of  the  debate  or  of  the  scru- 
tiny. Tiiere  are  no  essential  attributes  of  the  argument,  which  are 
not  comprehended  in  it,  or  suggested  by  it.  With  the  definition  as 
a  guide,  if  it  be  a  correct  one,  it  is  impossible  to  get  out  of  the  field. 
On  the  contrary,  if  it  be  incorrect,  it  is  impossible  certainly  to  know 
when  one  is  in  the  field.  It  is  the  text  of  the  subject  and  the  rule 
of  the  argument.  To  err  In  a  definition  is  a  necessary  doom  to 
perpetual  and  endless  error  in  all  that  grows  out  of  it ;  to  be  right 
in  this  start,  is  the  only  sure  guide  to  a  right  end. 

The  above  definition  is  the  fruit  of  the  study  of  years ;  and  for 
the  present  we  do  not  know  how  to  improve  it.  We  have  tried 
our  best  to  tolerate  the  introduction  of  the  term,  science,  into  this 
definition,  as  the  substantive  part  of  it,  in  accordance  with  general 
usage,  such  as  the  science  of  national  wealth,  &c. ;  and  we  do  not 
repudiate  the  idea  that  science  is  implied  in  it,  or  that  it  is  a  proper 
subject  of  science.  But  we  are  forced  to  deny,  that,  as  yet,  the 
subject  has  ever  been  reduced  to  a  science,  and  that,  down  to  this  /,  J /f  > 
time,  it  has  any  other  form  of  a  system  than  a  collection  of  what  the 
logicians  call  empirical  laws,  the  character  of  which  will  be  noticed 
by-and-by.  If  it  sl)all  be  admitted,  that  we  have  contributed,  in 
any  degree,  so  to  sift  these  empirical  laws,  and  so  to  adjust  them 
in  a  scientific  form,  as  to  subject  them  to  recognised  canons  of  ex- 
perimental induction,  as  we  propose  to  attempt  to  do,  still  our  defi- 
nition stands  in  a  form  not  inconsistent  with  the  definition  of  a 
science ;  and  though  we  fail  in  our  proposed  task,  the  purpose  of 
our  definition  is  not  impaired.  Its  terms  indicate  sufficiently  the 
class  of  sciences  among  which  it  must  take  rank,  if  it  Is  deemed 
worthy  to  be  called  a  science.  It  is  a  science  composed  oi  contin- 
gent propositions — contingent  on  the  peculiar  position,  the  peculiar 
interests,  and  the  peculiar  institutions  of  the  country  to  which  its 
rules  are  applied  at  any  given  time,  and  contingent  on  the  changes, 
In  these  particulars,  to  which  that  country  may  be  subject  in  the 
succession  of  events. 

It  will  be  seen,  therefore,  that  our  definition  is  a  new  point,  and 
that  it  rescues  the  whole  subject,  entirely,  from  t'^^^  — -:•* 


/ 


28        ^      r  *        THE    NEW    POINTS    OF    THIS    WORK.  ^ 

%'    .     has  been  claimed  for  it  by  the  Free-Trade  economists,  as  a  science 
,  i^    of  uniform  propositions  —  uniform  for  all  countries  and  for  all  time. 
^  ^'  f  Every  person  must  see,  that  one  of  the  essential  attributes  of  Free 
Trade  is  the  uniformity  of  its  propositions  for  all  nations,  and  that 
•    any  departure  in  a  system  of  public  economy  from  such  uniformity, 
is  not  Free  Trade,  but  a  violation  of  its  principles.     The  poles  of  a 
planet,  therefore,  can  not  be  wider  apart,  nor  the  heavens  farther 
from  the  earth,  than  the  main  positions  of  these  two  antagoni.stical 
■systems.     The  propositions  of  the  one  are  the  same  for  all  nations, 
in  all  time,  while  those  of  the  other  are  contingent  on  the  position, 
interests,  and  institutions  of  the  country  to  which  they  are  applied, 
for  the  time  being. 
7  We  assume  that  we  do  no  injustice  in  ascribing  this  position  to 

the  Free-Trade  economists,  though  they  have  not  expressed  them- 
selves precisely  in  these  terms.     If  they  give  up  this,  they  give  up 
all.     Their  argument  avails  nothing  except  upon  this  ground.     If 
their  science  is  not  one  of  uniform  propositions,  in  application  to  all 
countries,  in  all  times,  they  have  not  only  abused  the  public,  but 
made  dolts  of  themselves.     For  so  the  public  have  thought,  and 
their  argument  is  at  an  end  if  they  deny  it.     Possibly  they  have  not 
considered  how  many  categories  of  science  there  are,  or  how  dif- 
ferent some  of  them  are  from  some  others,  and  that  none  of  them 
are  exactly  alike.     There  is  a  class  of  sciences  called  exact,  of 
which,  doubtless,  the  Free-Trade  economists  suppose  theirs  is  one, 
or  one  equally  reliable  in  its  results.     And  if  it  be  a  science,  they 
are  right ;  for,  strictly  speaking,  no  science  can  be  more  exact,  or 
more  certain  in  its  final  conclusions,  than  another,  when  all  its 
elements  are  brought  together,  understood,  and  properly  adjusted. 
But  the  perfection  of  every  science  is  a  work  marked  by  stages,  by 
degrees.     That  of  astronomy  was  once  very  imperfect,  very  in- 
exact ;  but  it  has  now  attained  to  a  high   degree  of  perfection,  as 
demonstrated  in  the  precision  of  its  predictions.      "  Geometry," 
Mr.  Mill  says,  "  is  a  science  of  coexistent  facts,  altogether  inde- 
pendent of  the  laws  of  the  succession  of  phenomena  ;"  but  it  is  a 
very  exact  science.     The  science  of  mechanics  Is  exact ;  for  though 
the  relations  of  forces,  in  all  experiments,  are  constantly  shifting, 
their  results  are  equally  measurable,  the  forces  and  relations  being 
given.     The  mathematics  are  reckoned  among  the  exact  sciences, 
so  far  as  they  have  advanced,  and  from  the  nature  of  the  subject 
could  not  be  otherwise.     A  vast  many  branches  of  knowledge, 
capable  of  being  reduced  to  the  strictest  laws  of  science,  are  yet  in 


THE    NEW    POINTS    OF    THIS    WORK.  29 

the  chaotic  field  of  empirical  laws.  Science,  no  doubt,  appertains 
to  everything  in  nature,  in  man,  in  society,  in  morals,  to  everything 
in  which  man  has  or  takes  an  interest;  but  how  much  of  it  is  yet 
in  the  dark?  It  is  probably  nothing  but  our  ignorance  that  makes 
the  Saws  of  one  branch  of  knowledge  less  exact,  and  less  reliable 
to  us  than  those  of  another.  Science  appertains  to  tendencies,  to 
analogies,  to  chances,  to  the  very  contingencies  by  which  man  retains 
his  hold  on  life.  Life  insurance,  lotteries,  games  of  chance,  and 
many  other  classes  of  facts,  and  combinations  of  facts,  the  issues 
of  which  are  commonly  regarded  as  most  uncertain  and  fortuitous, 
are,  nevertheless,  based  upon  elements  not  less  susceptible  of 
scientific  adjustment,  for  the  attainment  of  the  most  infallible 
results,  than  those  of  any  science  that  now  boasts  of  the  greatest 
conceivabJe  exactitude  in  its  predictions. 

There  is  the  science  of  the  social  state,  or  of  sociology,  as  M. 
Comte  calls  it,  which  approximates  to,  more  properly,  perhaps, 
lies  behind,  the  science  of  public  economy ;  for  it  is  presumed 
they  will  not  be  pronounced  identical,  though  there  is  an  affinity  and 
a  sympathy.  But  this  science  of  sociology  is  very  difficult  to 
master,  in  order  to  predict  results  with  any  tolerable  success,  not- 
withstanding that  all  Its  elements  are  vested  in  the  individual  man. 
It  is  because  the  combinations  and  relations  of  these  elements, 
wherever  found,  are  so  infinitely  diversified,  and  for  ever  shifting. 
Make  a  case — which,  however,  is  impossible  —  suppose  a  case, 
then,  where  their  position,  combinations,  and  relations,  are  precisely 
the  same  as  in  another  given  case,  and  the  results  will  be  uniform; 
which,  if  true,  demonstrates  that  society,  in  its  organization,  move- 
ments, changes,  and  destiny,  is  governed  by  scientific  laws,  of  which, 
indeed,  there  can  be  no  doubt. 

"  Any  facts,"  says  Mr.  Mill,  "  are  fitted  in  themselves  to  be  a 
subject  of  science,  which  follow  one  another  according  to  constant 
laws,  although  those  laws  may  not  have  been  discovered,  nor  even 
be  discoverable  by  our  existing  resources."  Meteorology  and 
tidology  are  among  these  imperfect  sciences.  The  science  of 
human  nature  is  of  this  description,  as  also,  of  man  in  society,  or 
sociology.  "  If  our  science  of  human  nature,"  says  Mr.  Mill, 
"  were  theoretically  perfect,  that  is,  if  we  could  calculate  any  char- 
acter, as  we  can  calculate  the  orbit  of  any  planet, //om  given  data^ 
still  as  the  data  are  never  all  given  [in  the  case  of  man],  nor  ever 
precisely  alike  in  different  cases,  we  could  neither  make  infallible 
predictions,  nor  lay  down  universal  propositions."     Nor  can  we 


30  THE    NKW    POI.VTS    OF    THIS    WORK. 

make  artificial  experiments,  in  the  case  of  man  and  society,  as 
in  the  mathematical,  mechanical,  and  physical  sciences;  but  we 
are  always  compelled  to  take  man  and  society,  just  as  we  find 
him. 

As  we  are  now  approaching  the  main  point  on  which  our  defini- 
tion of  public  economy  is  based,  in  confirmation  of  the  correctness 
of  our  position,  we  would  here  cite  a  little  from  Mr.  Mill,  who, 
sympatinzing  with  the  state  of  society  in  Great  Britain,  is  himself 
a  Free-Trader.  We  wish  to  show  from  Mr.  Mill's  own  words, 
that,  as  in  sociology,  so  also  in  public  economy,  and  precisely  for 
the  same  reasons,  no  science  has  ever  yet  been  constructed.  Mr. 
Mill  says  :  "  There  is,  indeed,  no  hope  that  these  laws  [)aws  of 
sociology],  though  our  knowledge  of  them  were  as  certain  and  as 
complete  as  it  is  of  astronomy,  would  enable  us  to  produce  the 
history  of  society,  like  that  of  the  celestial  appearances  for  thousands 
of  }'^ar3  to  come.  But  the  difference  of  certainty  is  not  in  the  laws 
themselves  ;  it  is  in  the  data  to  which  those  laws  are  to  be  applied. 
In  astronomy  the  causes  influencing  the  result,  are  i'd'^,  and  change 
little,  and  that  little  according  to  known  laws ;  we  can  ascertain 
what  they  are  now,  and  thence  determine  what  they  will  be  at  any 
epoch  of  a  distant  future.  The  data,  therefore,  in  astronomy,  are 
as  certain  as  the  laws  themselves.  The  circumstances,  on  the  con- 
trary, which  influence  the  condition  and  progress  of  society,  are 
innumerable,  and  perpetually  changing;  and  though  they  all 
change  in  obedience  to  causes,  and  therefore  to  laws,  the  multitude 
of  the  causes  is  so  great  as  to  defy  our  limited  powers  of  calcula- 
tion." So  far  on  sociology.  Next  Mr.  Mill  adduces  the  very  case 
of  the  general  inquiry  of  this  work,  to  wit,  "  The  great  topic  of 
debate  in  the  present  day,  the  operation  of  restrictive  and  pro- 
hibitory commercial  legislation  on  national  wealth.  Let  this,  then,'* 
he  says,  "be  the  scientific  question  to  be  investigated  by  specific 
experience.  If  two  nations  can  be  found  which  are  alike  in  all 
natural  advantages  and  disadvantages ;  whose  people  resemble 
each  other  in  every  quality,  physical  and  moral,  innate  and  ac- 
quired ;  whose  habits,  usages,  opinions,  laws,  and  institutions  are 
the  same  in  all  respects,  except  that  one  of  them  has  a  more  pro- 
tective tariff;  and  if  one  of  these  nations  is  found  to  be  rich  and 
the  other  poor,  or  one  richer  than  the  other,  this  will  be  an  rxperl- 
mcntum  crucis  ;  a  real  proof  by  experience,  which  of  the  two  sys- 
tems is  most  favorable  to  national  riches.  But  the  sii-pjxjs'ition,  that 
tivo  such  Instances  can  be  met  with,  is  absurd  on  the  face  of  it.     Nor 


WORK. 

is  such  an  occurrence  ever  abstractedly  possible.     Two  nations      /^'-ff 
which  agreCvd  in  everything  except  their  commercial  policy,  would     /^ 
agree  also  in  that.     Differences  of  legislation  are  not  inherent  and  ^—^^^<^/ 
ultimate  diversities  ;  are  not  properties  of  kinds.     They  are  effects      P^Zt^t^  ^ 
of  preexisting  causes.     If  the  two  nations  differ  in  this  portion  of 
their  institutions,  it  is  from  some  difference   in  their  ]}osition,  and 
thence  in  their  (tpparmt  interests,  or  in  some  portion  or  other  of 
their  opinions,   habits,  and  tendencies  ;    which  opens  a  view  of 
further  differences,  without  any  assignable  limit,  caj)able  of  opera-  -^^ 
ting  on  their  industrial  prosperity,  as  well  as  on  every  other  feature 
of  their  condition,  in   more  ways  than   can  be  enumerated  or  ima- 
gined.    There  is  thus  a  demonstrated  impossibility  of  obtaining,     /Ti/ty^/^' 
in  the  investigations  of  the  social  science,  the  conditions  required 
for  the  most  conclusive  form  of  inquiry  by  specific  experience."        ^-"-^x-^*-^/ 

This  is  enough.  We  have  here  a  full  confession,  from  a  be-  {^y^^O^^/A> 
liever  in  Free  Trade,  a  severe  and  logical  argument,  itself  com-  y  l^_x 
posing  a  pa;t  of  a  system  of  logic,  that  even  two -nations  can  not  be  t5^\l^^^ 
found  enough  alike  to  justify  general  deductions  equally  applicable 
to  both  in  public  economy  ;  a  for/ tori,  that  no  such  rules  can  safely 
be  applied  to  all  nations,  as  is  claimed  by  Free  Trade.  Science.  XL 
here,  is  proved  to  be  utterly  at  fault  for  general  rules.  The  only 
defect  of  this  argument  is  the  last  sentence  of  the  above  citation, 
where  Mr.  Mill  would  seem  to  make  his  "  demonstrated  impossi- 
bility" apply  also  to  the  experience  of  one  nation.  It  clearly  ap- 
plies to  two,  and  much  more  to  an  increased  number;  but  there  is 
nothing  in  this  reasoning  to  show,  that  a  nation  may  not  find  rules 
in  its  own  experience  for  itself,  and  rules  based  on  scientific  and 
experimental  induction.  Mr.  Mill  has  not  only  demolished  the  so- 
called  science  of  Free  Trade,  which  assumes  to  give  rules  for  all 
nations,  but  he  has  fully  vindicated  our  definition,  and  shown  that 
it  was  impossible,  with  propriety,  to  give  any  other.  It  is  even 
possible  that  our  definition  should  fall  within  the  scope  of  a  well- 
built  science  ;  and  we  intend  yet  to  show  that  it  has  some  strong 
claims  to  that  position  ;  while  it  is  clearly  impossible  that  the  gen- 
eral propositions  of  Free  Trade  should  have  that  advantage. 

A  few  more  brief  remarks  of  Mr.  Mill  will  be  perdnent  here  : 
"  The  aim  of  practical  politics  is  to  surround  the  society  which  is     (Z*C~l\.  --^ 
under  our  superintendence  with  the  greatest  possible  number  of    x/Q.^UjtJjt, 
circumstances  of  which  the  tendencies  are  beneficial,  and  to  remove      .     \p  ^\y 
or  counteract,  as  far  as  practicable,  those  of  which  the  tendencies  are     '^^'*-^   "^ 
injurious.'"     Any  one  can  see  how  directly  this  looks  to  the  ex- 


32  THE    NEW    POINTS    OF    THIS    WORK.» 

V         .  ♦ 

perience  of  one  society  only  for  rules  of  its  policy,  and  how  directly 

opposed  it  is  to  general  rules  having  no  respect  to  such  experience. 
In  other  words,  it  falls  directly  within  the  line  of  our  definition. 
Again  :   "  It  would  be  an  error  to  suppose  we  could  arrive  at  any 
great  number  of  propositions,  which  will  be  true  in  all  societies 
without  exception.     Such  a  supposition  would  be  inconsistent  with 
the  eminently  modifiable  nature  of  the  social  phenomena,  and  the 
multitude  and  variety   of  the  circumstances    by  which    they  are 
modified  —  circunntanccs   never  (he  same,  or  even  nearly  the  same., 
in  two  dijfrrrnt  socic/ies,  or  in  two  different  periods  of  the  some  so- 
ciety. .  .  We  can  never  either  understand  in  theory,  or  command 
in  practice,  the  condition  of  a  society  in  any  one  respect,  without 
taking   into  consideration  its  condition   in   all  other  respects.    .   . 
Unless  two  societies  could  be  alike  in  all  the  circumstances  which 
surround  and  influence  them  (which  would  imply  their  being  alike 
in  their  previous  history),  no  portion  whatever  of  their  phenomena 
will,  unless  by  accident,   precisely  correspond ;  7io  one  cause  will 
-produce  exactly  the  same  iffcct   in   both.  .  .  We  can  never  affirm 
with  certainty  that  a  cause  which  has  a  particular  tendency  in  one 
people  or  in   one  age,  will   have   exactly   the  same    tendency  in 
another,  without  referring  back  to  our  premises,  and  performing 
over  again  for  the  second  age  or  nation,  that  analysis  of  the  whole 
of  its  influencing  circumstances,  which  we  had  already  performed 
for  the  first.     The  deductive  science  of  society  [here,  observe,  is 
the  very  hypothesis  of  Free  Trade  repudiated]  does  not  lay  down 
a  theorem,  assertin<r  in  a   universal  manner  the  tfftct  of  any  cause; 
hut  rather  teaches  ns  how  to  frame  the  proper  theorem  for  any  given 
case  [which  is  the  principle  of  our  definition].     //  does  not  give  us 
the  laws  of  society  in  general,  but  the  means  of  determining  the 
phenomena  of  any  given  society,  from  the  particular  elements  or 
data  of  that  society.     All  the  general  propositions  of  the  deductive 
science   [such    as    those  of   Free   Trade]   are,  therefore,  In  the 
strictest  sense  of  the  word,  hypotlietical.      The  hypothetical  com- 
bination of  circumstances   upon   which  we  construct  the  general 
theorems  of  the  science,  can  not  be  made  very  complex,  without  so 
rapidly  accumulating  a  liability  to  error  as  must  soon  deprive  our 
conclusions  [which  happen  to  be  those  of  Free  Trade]  of  all  value. 
This  mode    of  inquiry    [to  wit,  Free  Trade],    considered   as     a 
means  of  obtaining  general  propositions,  must  therefore,  on  pain  of 
•  entire  frivolity,  be  limited  to  those  classes  of  social  facts  which, 

jk  ^  ^         though  influenced  like  the  rest  of  all  sociological  agents,  are  under 


^      * 


N 


4> 


THE    NEW    POINTS    OF    THIS    WORK.  33 

the  rmmed'tnte  influence,  principally  at  least,  of  a  ^e\\  only.  .  . 
In  order  to  verify  a  theory  by  an  experiment,  the  circumstances 
of  the  experiment  must  be  exactly  the  same  as  those  contemplated 
in  the  theory.  But  in  social  phenomena  the  circumstances  of  no 
two  experiments  are  exactly  alike." 

This,  we  confess,  is  one  of  the  most  remarkable  confutations  of 
the  theory  of  Free  Trade  we  have  ever  seen  ;  and  the  more  re- 
markable as  coming  from  one  who  believes  in  the  doctrine.  Thanks 
to  his  fidelity  as  a  logician,  he  would  not,  and  could  not,  sacrifice 
logic  to  a  fancy  of  this  kind.  Without  dreaming  of  this  incidental 
result  of  such  a  discharge  of  his  professional  functions,  he  has  swept 
Free  Trade  clean  into  an  irrecoverable  abyss. 

This  point  is  so  important  in  the  general  argument,  that  we  are 
tempted,  notwithstanding  the  fulness  and  sufficiency  of  Mr.  Mill's 
reasonings,  to  add  a  little  of  our  own. 

There  is  usually  no  more  similarity  or  equality  in  the  condition 
and  interests  of  nations,  than  in  those  of  private  persons  ;  and  the 
very  necessity  of  a  system  of  public  economy,  for  any  one  nation, 
in  its  relations  to  others,  is  based  upon  the  fact  of  such  dissimilarity 
and  inequality.  If  there  were  no  diversity  of  interests  in  different 
nations,  and  no  dissimilarity  in  their  condition,  physical  or  social,  a 
common  system  of  public  econoAiy  might,  perhaps,  be  equally 
adapted  to  all.  It  is  the  exigency,  or  permanent  fact,  of  these  dif- 
ferences, numerous,  essential,  and  important,  which  renders  systems 
of  public  economy  —  diversified  as  the  circumstances  to  which 
they  are  applied  —  indispensable  to  all  nations;  and  if  they  are 
not,  in  each  case,  adapted  to  these  differences,  and  made  expressly 
for  them,  they  will  not  only  fail  of  their  end,  but  will  probably  be 
injurious.  A  system  made  for  one  nation,  and  adapted  to  its  con- 
dition and  interests,  may  be  ruinous  to  another — will  certainly  be 
more  or  less  hurtful. 

IJicardo  has  very  well  said  :  "  That  which  is  wise  in  an  individ- 
ual, is  wise  also  in  a  nation."  We  know  that  no  two  persons  can 
be  found,  whose  condition  and  interests  are  precisely  similar,  and 
that  each  must  have  his  own  rules  for  the  management  of  his  own 
affairs.  It  would  be  mischievous,  possibly  ruinous,  for  any  two 
persons  to  interchange  rules  of  private  life  and  economy,  and  for 
each  to  work  by  those  of  the  other.  Nor  could  both  work  by  the 
same  rules.  Just  in  proportion  as  the  difference  in  the  condition, 
pursuits,  and  interests  of  any  such  two  persons,  is  increased,  in  the 
same  proportion  must  there  be  a  difference  in  their  respective  sys- 
3 


34  THE    NEW    POINTS    OF    THIS    WORK. 

terns  of  private  economy,  or  rules  of  business.  The  farmer  can  not 
work  by  the  rules  of  a  meclianic  ;  or  of  a  merchant ;  or  of  an  artist ;  or 
of  a  lawyer  ;  or  of  a  doctor ;  or  of  a  soldier  ;  nor  can  either  of  these 
work  by  the  rules  of  either  of  the  others  ;  and  so  on,  through  all  the 
diversified  pursuits  of  life,  each  one's  system  of  economy,  or  rules  of 
business,  must  be  adapted  to  his  pursuit  and  peculiar  position  and 
interests.  Even  those  in  the  same  calling  require  rules,  or  a  sys- 
tem, adapted  to  the  peculiarities  of  their  respective  positions  and 
circumstances.  The  same  system  can  not  be  equally  beneficial  to 
any  two  parties,  whose  position  and  interests  are  in  any  respect 
diverse.  It  must  be  seen,  therefore,  that,  although  there  may  be 
prinriples  of  conduct  common  to  all  persons,  there  can  not  be  a 
common  economical  system  for  any  two. 

In  the  same  manner,  it  is  impossible  that  a  given  system  of  pub- 
lic economy  should  be  equally  well  adapted  even  to  two  nations  ; 
and  much  more  impossible,  that  it  should  be  adapted  to  all  nations. 
Adam  Smith's  pretension,  therefore,  in  giving  to  the  world  his  "In- 
quiry," &c.,  is  a  manifest  absurdity,  if  the  title  of  "the  Wealth  of 
Nations"  be  regarded  as  involving  a  proposition  descriptive  of  the 
work,  which  may,  no  doubt,  with  fairness,  be  accepted  as  the  inten- 
tion. It  is  believed,  that  he  wrote  for  all  nations,  Great  Britain, 
perhaps,  excepted.  It  is  certain  that  his  system  has  been  received 
by  the  world,  as  carrying  with  it  this  pretension.  Adam  Smith 
doubtless  supposed,  that  he  was  laying  the  foundations  of  a  science ; 
and  those  of  his  school,  such  as  Say,  Ricardo,  and  M'Culloch, 
have  been  more  open  and  more  emphatic  in  their  claims,  and  have 
not  hesitated,  as  before  observed,  to  rank  the  Free-Trade  hypoth- 
esis among  the  sciences.  M'Culloch  says:  "Political  economy 
may  be  defined  to  be  the  science  of  the  laws  which  regulate,"  &c. 
He  also  says :  "  Political  econonly  is  of  very  recent  origin,"  that 
is,  as  a  science  ;  and  that  "  it  was  not  treated  in  a  scientific  man- 
ner, till  about  the  middle  of  the  last  century."  Of  M.  Quesney,  a 
physician,  attached  to  the  court  of  Louis  XV.,  he  says,  that  "  he 
gave  to  political  economy  a  systematic  form,  and  reduced  it  to  the 
rank  of  a  science."  Also  :  "  We  are  justified  in  considering  Dr. 
[Adam]  Smith  the  real  founder  of  the  modern  system  [science]  of 
political  economy." 

In  the  same  manner,  all  the  economists  of  the  Free-Trade  school 
have  imbibed  the  notion,  and  started  on  the  principle,  maintaining 
that  position  throughout,  that  their  theory  is  a  science,  composed 
of  uniform  propositions,  all  the  world  over,  and  in  all  time.     M. 


/ y  yf.    >    >^  /^THE  ^^W    rOI-XTS    OF    THIS^ORK.  ^  35    ^   .*        ^        >^ 

/^^Sf^-"^/  ^ f^^-^LH^^r^t.<>^  /^C^t:^>^-^^  ^:l^i4yi,^^^ 

Say  declares,  in  the  most  unqualifieuann  emphatic  terms  :  "  The  /^J>^*^<f^ 
maxims  of  political  economy  are  immutable."  ^;^__  '>y>-,    * 

As  there  can  be  no  doubt  of  the  character  of  this  claim,  it  is  un-  r^  ^^v^ 
necessary  to  go  into  minute  proof  of  the  fact;  or,  if  it  is  allowed  to  ^/yLA^"*^ 
be  too  absurd  to  be  credited,  the  pretension  itself  is  disposed  of.  <%tj^__^ 
All  must  see,  that  it  has  not  a  shadow  of  just  pretence  to  occupy 
this  position.     And  yet  it  will  be  found,  that  it  was  solely  by  its 
assumption,  without  warrant,  and  without  reason,  that  the  most  stu- 
pendous errors  have  been  palmed  upon  the  world,  under  the  sto-     ^.^%/t^fje/W 
len  shield  of  sciknce,  simply  because  the  claim  being  conceded,       t/J*'^ 
or  not  challenged,  it  was  vain  to  oppose  deductions  put  forward     f    J    J{ 
ifnder  such  authority.     They  claimed  that  the  theory  was  scie^i-    ^^/TjCf/i^ 

tJJic ;  nobody  challenged  the  claim;  and  who  would  dare  to  oppose   ^ ^^     ^ 

science'?  Thus,  for  the  greater  part  of  a  century,  the  Free-Trade  ^^  j^ 
economists  have  had  no  inconsiderable  sway,  it  might,  perhaps,  /'^-^•^^ 
be  said,  a  full  sweep  of  influence,  by  the  authority  of  a  false  pre-  ^-^  ^^^!^*^ 

^^"'^°"-  .  .         .  .      ^'%^^^ 

Observe  the  following  remarks  on  this  point  by  Napoleon,  in  ^,-S^ 


licatiorr.     The  political  constitution  of  differ-      y^-'^'^^*^^ 
he,  "  must  render  these  principles  defective  ; 


his  exile,  as  reported  by  Las  Cases  :  "  He  opposed  the  principles     \C^      4^,/i. 
of  the  economists,  which  he  said  were  correct  in  theory,  though     •  cJL^ 

erroneous  in  their  app 
ent  states,"  continued  h 

local  circumstances  continually  call  for  deviation  from  their  unifor- 
mity. Duties,"  he  said,  "  which  were  so  severely  condemned  by 
political  economists,  should  not,  it  is  true,  be  an  object  to  the  treas- 
ury ;  they  should  be  the  guaranty  and  protection  of  a  nation,  and 
should  correspond  with  the  nature  and  the  objects  of  its  trade.  Hol- 
land, which  is  destitute  of  productions  and  manufactures,  and  which 
has  a  trade  only  of  transit  and  commission,  should  be  free  of  all 
fetters  and  barriers.  France,  on  the  contrary,  which  is  rich  in 
every  sort  of  production  and  manufactures,  should  incessantly  guard 
against  the  importations  of  a  rival,  who  might  still  continue  supe- 
rior to  her,  and  also  against  the  cupidity,  egotism,  and  indifference 
of  mere  brokers.  I  have  not  fallen  into  the  error  of  modern  sys- 
tematizers,"  said  the  emperor,  "  who  imagine  that  all  the  wisdom 
of  nations  is  centred  in  themselves.  Experience  is  the  true  wis- 
dom of  nations.  And  what  does  all  the  reasoning  of  the  econo- 
mists amount  to  ?" 

No  one,  probably,  has  lived,  since  public  economy  became  a 
subject  of  debate,  who  understood  it  better,  for  practical  purposes, 
than  this  extraordinary  man. 


V     .     36  »  THE    NEW   POINTS    OF   THIS    WORK.  , 

•  It  will  be  seen,  that  our  definition,  including  a  given  position, 

given  interests,  and  given  institutions  of  a  state,  as  elements  of 

public  economy,  is  fully  justified  by  what  Napoleon  calls  "  the  po- 

»\-  litical  constitutions  of  different  states,"  and  "local  circumstances." 

♦  •*  ■       In  denying  the  claim  of  Free  Trade  to  a  science,  we  do  not 

mean,  that  there  can  not  be  common  principles,  which,  in  abstract 

forms  and  isolated  positions,  are  equally  true  all  the  world  over, 

%^^v    any  more  than  that  we  mean  to  arraign  the  religious  and  moral 

'*'J  i  ,        principles  of  the  decalogue,  which,  by  all  Christians  and  Jews,  are 

*  allowed  to  be  eternal  and  immutable  ;  or  any  more  than  we  would 
1.      question  the  verities  of  figures  and  mathematical  demonstrations. 

But  the  question  is,  as  to  the  application  of  the  same  principles,  in 

combination  or  in  separate  form,  to  things,  or  to  states  of  things, 

which  are  different  from  each  other.     There  is  not  a  principle  in  the 

,      decalogue  which  may  not  be  perverted,  and  which,  if  perverted, 

•►  .♦*  *f  ♦  *  1^  will  not  lead  to  an  unfortunate  or  criminal  result.  Figures  them- 
selves, which  are  commonly  said  not  to  lie,  may  be  employed  to 
verify  the  most  absurd  and  stupendous  errors,  by  mistakes  in  the 
premises,  or  by  perversity  of  application. 

^j  It  will  be  observed,  that  we  have  not  only  departed  from  usage, 

in  our  definition  of  public  economy,  by  denominating  it  the  appli- 
cation of  knowledge  derived  from  experience,  instead  of  calling  it 
a  science  ;  but  that  we  require  a  given  position,  given  interests,  and 
given  institutions  of  a  state  or  nation,  in  order  to  know  how  to  make 
the  application.  The  very  terms  of  our  definition,  therefore,  take 
the  whole  subject  from  the  determinate  and  immutable  laws  of  Free 
Trade,  and  place  it  on  what  may  be  called  a  contingent  basis,  it- 
self subject  to  a  variety  of  contingences.  In  Free  Trade,  we  have 
only  to  understand  its  propositions,  and  then  we  know  what  they 
prove,  or  pretend  to  prove.  But  in  our  theory  of  public  economy, 
we  consult  facts,  experience,  under  a  given  state  of  things,  in  order 
to  form  the  right  propositions.  In  Free  Trade,  the  propositions 
lead  ;  in  our  system,  they  follow.  In  the  former,  the  propositions 
determine  results,  or  affect  to  do  so ;  in  the  latter,  facts,  by  their 
practical  operation,  determine  the  propositions,  because  they  deter- 
mine results.  In  the  former  case,  the  theory,  or,  rather,  the  hy- 
pothesis, is  first,  and  the  results  are  hypothetical ;  in  the  latter,  the 
theory  is  last,  and  is  made  to  depend  on  the  facts.  Our  theory, 
therefore,  is  not  one  of  propositions,  formed  irrespective  of  facts ; 
but  a  theory  growing  out  of  facts. 

Our  theory,  instead  of  being  a  preconceived  hypothesis,  like  that 


THE    NEW   POINTS    OF    THIS  WORK.  37 

of  Free  Trade,  is  in  fact  a  theory,  and  involves  an  established  con- 
nexion between  facts  that  have  been  and  facts  which,  in  Uke  cir- 
cumstances, must  necessarily  follow,  but  which  are  not  always 
found  to  be  the  sarne,  in  all  circumstances,  but  often  greatly  di- 
verse. The  doctrines  resulting  from  our  theory,  are  subject  to 
such  modification  as  facts  and  circumstances  require,  in  the  place 
where  they  are  applied,  being  sometimes,  in  some  particulars,  in 
direct  opposition  in  one  place  to  those  of  another.  It  is  not  setting 
up  an  hypothesis  to  beget  an  entity ;  but  it  assigns  an  adequate 
cause  for  the  entity  itself.  The  propositions  of  a  sound  system  of 
public  economy,  therefore,  are  entirely  contingent  on  the  experi- 
ence of  the  past  and  a  given  state  of  things,  and  not  determinate, 
absolute,  and  immutable,  like  those  of  Free  Trade. 

We  have  included  in  our  definition  given  institutions,  as  well 
as  a  given  position  and  given  interests  of  a  state  or  nation,  notwith- 
standing that  M.  Say  has  said,  that  "  wealth  is  essentially  inde- 
pendent of  political  organization,"  or  of  the  structure  of  society. 
We  shall  have  abundant  occasion  to  show  that  "  political  organ- 
ization," or  the  structure  of  society,  is  an  "  ^sential"  element  of 
public  economy.     This  untenable  position  of  M.  Say,  originated 
in  a  forced  effort  to  divorce  what  he  called  "  political  economy," 
from  "  politics,"  and  to  maintain  it  in  the  rank  of  the  sciences,  as 
if  a  statesman  had  nothing  to  do  with  the  elements  of    legislation. 
The  very  purpose  of  public  economy  is  for  the  guidance  of  legis- 
lators.    It  vi'as  quite  unnecessary  to  take  up  this  false  position,  to 
keep  the  teachings  of  public  economy  apart  from  the  agitations  of 
*' politics."     There  is  no  necessary  connexion  between  these  two 
spheres  of  action  or  of  duty  ;  though  it  is  impossible  to  destroy  the 
connexion  between  the  things  taught  and  their  practical  use.      The 
doctrines  are  promulgated  from  the  closet;  they  are  I'educed  to 
practice  in  the  high  places  of  the  nation.     The  teachers  are  neces- 
sarily recluses,  buried  in  the  profound  retreats  of  philosophy,  as 
an  indispensable   incident  of  their  vocation.     Although  they  may 
desire  that  what  they  regard  as  truth  may  prevail,  it  is  not  their 
business  to  give  it  currency.     But  the  main  object  of  M.  Say  in 
asserting  that  "  wealth*  is  essentially  independent  of  political  organ- 
ization," or  of  the  structure  of  society,  was  to  guard  his  system  as 
a  science,  and  to  put  forward  its  prerogatives. 

We  trust,  therefore,  it  will  be  seen,  that  the  new  point  wj 
made,  in  our  definition  of  the  general  subject,  is  one  of  fundamental, 
pervading,  supreme  importance.     Its  very  terms,  once  made  out  as 


•. 


3S 


THE    NEW    POINTS    OF    THIS    WORK. 


correct,  are  a  complete  refutation  of  the  pretensions  of  Free  Trade. 
If  the  public  economy  of  a  country  is  to  be  based  upon  its  own 
experience,  and  if  all  the  propositions  constituting  the  system,  are 
to  arise  out  of  the  peculiar  position,  interestij,  and  institutions  of 
that  country,  it  is  not  possible  that  Free  Trade  should  have  any- 
thing to  do  with  it. 

It  will  also  be  seen,  that,  from  our  definition,  as  a  starting  point, 
the  field  of  public  economy  opened  by  it,  is  entirely  new.  It  is 
not  tlie  world,  it  is  not  all  nations,  it  is  not  any  two  nations  ;  but  it 
is  one  nation  in  particular.  The  law  of  the  definition  necessarily 
brings  the  subject  within  these  limits.  This  imparts  an  entirely 
new  character  to  the  argument.  With  general  propositions  we 
have  nothing  to  do;  it  is  a  particular  case.  It  is  a  system  of  pub- 
lic economy  for  the  United  States  alone,  which  we  are  required  to 
frame.  It  has  been  shown  above,  that  it  is  not  possible  to  con- 
struct one  for  all  nations,  nor  even  for  two.  All  pretensions  of  this 
kind  are  utterly  baseless,  and  can  do  nothing  but  evil,  so  far  as 
they  are  influential. 

2.  The  next  new  point  of  this  work  we  propose  to  consider,  is, 
that  public  economy  has  never  yet  been  reduced  to  a  science,  and 
that  all  the  propositions  of  which  it  is  composed,  down  to  this  time, 
are  empirical  laws.  That  it  has  not  been  reduced  to  a  science,  has 
already  been  shown.  That  all  its  propositions  are  properly  subjects 
f  science,  we  do  not  deny;  on  the  contrary,  we  maintain  it;  but 
fvhat  we  aver  is,  they  have  never  yet  been  adjusted  in  a  scientific 
and  reliable  form.  Many  of  them  are  true  and  many  are  false  ;  but 
*it  is  impossible  to  know  which  are  true  and  which  false,  until  they 
are  brought  under  the  severe  test  of  scientific  induction.  We  have 
done  enough  already  to  bring  under  suspicion,  and  in  some  cases, 
to  falsify,  all  general  propositions  on  this  subject,  such  as  those  of 
Free  Trade.  The  invincible  rules  of  logic,  such  as  we  have  cited 
above  from  Mr.  Mill,  put  this  question  out  of  debate.  We  have 
yet  to  show  that  it  is  possible  to  reduce  public  economy  to  a 
science,  by  confining  its  propositions  to  a  single  case,  or  a  single 
nation,  and  only  in  that  way  ;  and  also,  that  this  work,  by  adhering 
to  that  rule,  is  constructed  on  the  most  rigid  principles  of  scientific 
induction. 

But  what  is  meant  by  empirical  Jmvs  ?     We  do  not  mean  by 

,.  this,  imputation  what  is  commonly  understood  by  empiricism  or 

quackery;  but  we  refer  to  a  class  of  propositions,  so  denominated  by 

loo-icians,  to  distinjcuish  them  from  those  which  have  not  found  their 


I 


THE    NEW    POINTS    OF    THIS    WORK.  39 

place  in  science.  "  Experimental  philosophers,"  says  Mr.  Mill, 
"  usually  give  the  name  of  empirical  laws  to  those  uniformities 
which  observation  or  experiment  has  shown  to  exist,  but  upon 
which  they  hesitate  to  rely  in  cases  varying  much  from  those  which 
have  been  actually  observed,  for  want  of  seeing  any  reason  why 
such  a  law  should  exist.  It  is  implied,  therefore,  in  the  notion  of 
an  empirical  law,  that  it  is  not  an  ultimate  law  ;  that  if  true  at  all, 
its  truth  is  capable  of  being,  or  requires  to  be  accounted  for.  It  is 
a  derivative  law,  the  derivation  of  which  is  not  yet  known.  To 
state  the  explanation,  the  why  of  the  empirical  law,  would  be  to 
state  the  laws  from  which  it  is  derived,  the  ultimate  causes  upon 
which  it  is  contingent.  And  if  we  knew  these,  we  should  also 
know  what  are  its  limits,  under  what  conditions  it  would  cease  to 
be  fulfilled.  .  .  Now  it  is  the  very  nature  of  a  derivative  law, 
which  has  not  yet  been  resolved  into  its  elements,  in  other  words, 
an  empirical  law,  that  we  do  not  know  whether  it  results  from  the 
different  effects  of  one  cause,  or  from  effects  of  different  causes. 
We  can  not  tell  whether  it  depends  wholly  upon  laws,  or  partly 
upon  laws  and  partly  upon  collocation.  .  .  Empirical  laws,  until 
explained,  and  connected  with  the  ultimate  laws  from  which  they 
result,  have  not  attained  the  highest  degree  of  certainty  of  which 
laws  are  susceptible."  But  the  following  is,  as  we  think,  what 
more  particularly  applies  to  the  present  subject :  "  The  property 
which  philosophers  usually  consider  as  characteristic  of  empirical 
laws,  is  that  of  being  unfit  to  be  relied  on  beyo7id  (he  Umils  of  tune ^ 
flace,  tiiid  circuiii stances,  in  ichich  the  obscrvatiovs  have  been  made. 
These  are  empirical  laws  in  a  more  emphatic  sense.  .  .  Until  a 
uniformity  can  be  taken  out  of  the  class  of  empirical  laws,  and 
brought  either  into  that  of  causation,  or  of  the  demonstrated  [sci- 
entific] results  of  the  laws  of  causation,  it  can  not  with  any  assu- 
rance be  pronounced  true  beyond  the  local  and  otiicr  limits  within 
ifhnh  it.  has  bco)  found  so  by  actual  observation.^^ 

Both  the  novelty  and  importance  of  the  position  here  taken,  de- 
mand some  exposition.  If  it  be  well  authorized,  true  in  fact,  for 
the  purpose  we  have  in  view,  it  can  not  be  too  well  understood. 
When  Free-Trade  economists  have  arrogated  the  high  and  dig- 
nified tide  of  a  science  for  their  theme,  one  naturally  asks,  what 
sort  of  a  science  is  if?  In  what  is  its  artificial  structure  apparent? 
Where  are  the  principles  and  rules  by  which  we  arrive  at  infallible 
conclusions  ?  A  science,  well  and  truly  formed,  can  predict  results 
with  certainty  ;  it  is  the  very  nature  of  science  to  do  this,  and  any 


\i 


»\ 


40  THE    NEW    POINTS    OF    THIS    WORK. 

pretension  of  this  kind  that  fails  in  its  predictions,  is  thereby  proved 
false.  Have  the  laws  of  public  economy  ever  yet  been  so  adjusted 
as  to  produce  this  result? — Manifestly  not.  If  they  had,  all  the 
world  would  have  known  it,  and  there  would  be  no  controversy. 
The  truth  is,  the  whole  subject  still  remains  a  wide  field  of  empirical 
laws,  not  entirely  useless,  but  yet  unadjusted  as  to  scientific  order 
and  relations,  having  not  the  slightest  claim  to  the  dignity  of  a 
science.  If  any  should  think  we  have  failed  in  our  classification 
of  the  laws  of  public  economy,  in  their  historical  condition  down 
to  this  time,  as  being  em-jmical,  let  them  tell  us  under  what  category 
of  dogmas  they  should  be  ranked  ;  or  let  them  say,  if  they  choose, 
that  they  do  not  all  belong  to  this  class.  We  are  not  tenacious  on 
that  point.  We  only  say,  they  have  never  yet  been  reduced  to  a 
science.  That  is  evident,  because  there  is  no  certainty  of  science 
in  them.  There  is  no  uncertainty  in  figures,  in  mathematics,  in 
geometry,  in  astronomy,  or  in  the  physical  sciences  generally,  so 
far  as  their  respective  domains  have  been  explored ;  nor  is  there 
uncertainty  in  any  science,  the  elements  of  which  have  been  ascer- 
tained and  adjusted  in  scientific  order  and  relations.  There  can 
be  none.  It  is  the  very  nature  of  science  to  realize  its  predictions. 
We  do  not  affirm  confidently,  that  all  the  dogmas  which  ever  have 
been  uttered  on  public  economy,  will  fill  within  the  logician's  defi- 
nition of  empirical  laws  ;  but  we  think  they  will  generally  be  found 
there,;  nor  can  we  conceive  how  a  more  respectable  rank  could 
fairly  be  assigned  to  them.  It  is  not  simply  for  the  convenience  of 
classification,  that  we  have  put  them  there ;  but  because  we  could 
not  find  a  more  legitimate  place. 

Now,  let  us  consider  what  the  characteristic  of  an  empirical  law 
is,  as  presented  in  the   above  citation:  "The  property  of  being 
.  unfit  to  be  relied  on  beyond  the  limits  of  time,  place,  and   circuni- 

1^  stance,  in  which  the  observations  have  been  made."     It  may  not 

always  be  so  good  as  this  ;  but  it  can  not  be  better.  It  must  be 
seen,  therefore,  that  it  entirely  cuts  off  the  generalizations  of  Free 
Trade,  and  falls  directly  in  the  line  of  our  definition.  No  law  of 
public  economy  can  be  safely  trusted  except  for  "  the  time,  place, 
and  circumstance,  in  which  the  observations  have  been  made  ;'' 
that  is,  the  observations  which  have  established  the  law.  The 
principle  necessarily  restricts  every  system  of  public  economy  to 
one  nation  —  to  that  nation  where  the  observations  that  have  dic- 
tated its  laws,  have  been  made.  Within  these  limits  empirical  laws 
may  be  serviceable,  and  by  proper   attention  may  be   reduced  to 


/ 


THE    NEW    POINTS    OF    THIS    WORK.  41 

a  science.  For  a  wider  range,  it  is  not  possible  that  a  science 
should  be  made  of  them  on  this  subject.  In  the  language  of  Mr. 
Mill,  in  a  citation  under  the  former  head,  it  is  not  simply  "  absurd, 
but  abstractedly  impossible." 

The  effect  of  this  new  position,  if  it  shall  be  allowed  to  be  well 
sustained,  is  obvious.  Dislodged  from  the  platform  of  the  sciences, 
on  which  they  have  always  claimed  to  stand,  and  which  was  their 
sole  authority,  the  Free-Trade  economists  are  utterly  discomfited. 
None,  we  think,  can  fail  to  see,  after  what  has  been  proved  above, 
that  the  pretensions  of  Free  Trade  to  the  rights  and  authority  of 
a  science,  are  perfectly  absurd. 

3.  We  now  propose  to  notice,  as  another  new  feature  of  this 
work,  that  we  have  endeavored  to  subject  its  propositions,  so  far  as 
they  relate  to  the  main  question  in  debate,  to  the  most  rigid  test  of 
the  recognised  canons  of  experimental  induction,  as  laid  down  by 
logicians ;  and  consequently,  that,  in  this  particular,  and  so  far  as 
we  may  be  allowed  to  have  succeeded,  the  subject  will,  perhaps, 
have  some  claim  to  be  regarded  as  rescued  from  the  field  of  empir- 
ical laws,  and  installed  in  the  position  of  a  science. 

We  cite  the  canons,  thus  employed,  from  Mr.  Mill,  as  follow  :  — 

1.  "  If  two  or  more  instances  of  the  phenomenon  under  inves- 
tigation have  only  one  circumstance  in  common,  the  circumstance 
in  which  alone  all  the  instances  agree  is  the  cause  or  effect  of  the 
given  plienomenon. 

2.  "  If  an  instance  in  which  the  phenomenon  under  investiga- 
tion occurs,  and  an  instance  in  which  it  does  not  occur,  have  every 
circumstance  save  one  in  common,  that  one  occurring  only  in  the 
former;  the  circumstance  in  which  alone  tlie  two  instances  differ, 
is  the  effect  or  cause,  or  a  necessary  part  of  the  cause,  of  the  phe- 
nomenon. 

3.  "  If  two  or  more  instances  in  which  the  phenomenon  occurs 
have  only  one  circumstance  in  common,  while  two  or  more  instan- 
ces in  which  it  does  not  occur  have  nothing  in  common  save  the 
absence  of  that  circumstance  ;  the  circumstance  in  which  alone  the 
two  sets  of  instances  differ,  is  the  effect  or  cause,  or  a  necessary 
part  of  the  cause,  of  the  phenomenon. 

4.  "  Subduct  from  any  phenomenon  such  part  as  is  knovA'n,  by 
previous  inductions,  to  be  the  effect  of  certain  antecedents,  and  the 
residue  of  the  phenomenon  is  the  effect  of  the  remaining  antece- 
dents. 

5.  "  Whatever  phenomenon  varies  in  any  manner  whenever  an- 


i 


0^^^  ^  \4^  ^  j^,^^^t.^^^^>^^-^-^^^^-^ 


•^^  -lO^  /THE    NEW    POINTS    OF    THIS    WORK.  y  / 

other  phenomenon  varies  in  sontie  particular  nnanner,  is  either  a  cause 
or  an  effect  of  that  phenomenon,  or  is  connected  with  it  through 
some  fact  of  causation." 

"  These  methods,"  says  Mr.  Mill,  "  are  the  only  possible  modes 
of  experimental  inquiry,  of  direct  induction  a  posteriori,  as  distin- 
guished from  deduction.  At  least,  I  know  not,  nor  am  I  able  to 
conceiv^e,  any  others.  These,  then,  with  such  assistance  as  can  be 
obtained  from  deduction,  compose  the  available  lesources  of  the 
human   mind  for  ascertaining  the  laws  of  the  succession  of  phe- 


nomena." 


Mr.  Mill  has  demonstrated  at  large  the  truth  of  these  canons. 
Any  one  who  chooses  to  refer  to  the  demonstration,  will  find  it 
complete  and  satisfactory,  beyond  the  possibility  of  error.    >^ 

We  have  not  introduced  these  canons  here  because  we  expect 
to  find  room  to  make  and  explain  their  application  along  with  the 
current  of  the  argument  where  they  apply  ;  but  merely  to  suggest 
a  recognised  test,  the  authority  of  which  will  not  be  questioned, 
and  wliieh  can  be  employed  as  such  by  those  who  are  already 
versed  in  these  rules,  or  who  will  take  the  trouble  to  make  them- 
selves acquainted  with  their  application.  Having  already  shown 
that  public  economy  has  never  yet  been  reduced  to  a  science,  and 
as  that  object  would  turn  us  entirely  aside  from  the  specific  design 
of  this  work,  except  as  an  incidental  effect  which  may  possibly  in 
some  de<nee  be  achieved,  we  are  forced  to  decline  a  task  which 
would  of  itself  occupy  the  sole  attention  of  a  properly-endowed 
and  properly-qualified  mind,  in  a  work  not  less  extensive,  perhaps, 
than  tha't  to  which  we  are  limited  in  an  endeavor  to  develop  the 
practical  parts  of  this  science.  We  conceive  that  the  construction 
of  this  science  is  unoccupied  ground,  a  field  yet  to  be  entered  by 
some  one,  whose  talents  may  qualify,  and  whose  ambition  may 
prompt,  him  to  so  laudable  an  undertaking.  All  that  we  profess 
is,  that  we  have  taken  the-e  canons  as  our  rule  in  the  construction 
of  the  main  argument  of  this  work,  and  that  we  have  been  essen 
tially  aided  by  their  light  shining  on  our  path. 

We  for  a  long  time  thought  tliat  public  economy  never  could  be 
made  a  science  in  the  strict  sense  of  the  term.  But  that  position 
can  hardly  be  maintained,  if  it  be  allowed  that  everything  is  a  sub- 
ject of  science,  and  capable  of  being  brought  into  its  place  as  such  ; 
and  if,  moreover,  it  be  considered,  that  it  is  a  part  of  science  to 
adapt  itself  to  the  nature  of  the  subject.  A  science  of  contingent 
propositions,  for  aught  that  can  be  seen,  is  as  supposable  as  one  of 


uniform  and  immutable  propositions.     The  propositions  of  public    C-'^v^ ^ 
economy,  as  we  hold,  must  necessarily  change  with  a  chano;e  of   y^-^*yt-^ 
data ;  and  it  can  not  be  denied,  that  such  changes  are  constantly  ^Ci/   ^^ 
transpiring  in  every  commonwealth.     It  will  be  found   that   this 
principle  of  a  liability  to  a  change  of  data,  presents  itself  on  the 
threshold,  and  that  it  lies  at  the  foundation  of  the  science  of  public 
economy.     It  is  impossible  to  cast  it  aside,  or  turn  the  back  upon 
it,  with  any  hope  of  a  successful  investigation,  or  useful  result.     A 
public  measure  required  at  one  time,  may,  by  events,  or  even  by 
its  own  operation  in  the  complete  fulfilment  of  its  purpose,  require 
to  be  modified,  or  suspended,  or  superseded,  at  a  subsequent  pe- 
riod ;  and  the  same  measure  may  be  of  the  greatest  importance  to 
one  nation,  which,  would  be  injurious  to  another,  possibly  to  all    >/ 
others.     Nothing  can  be  more  contingent  than  the  propositions  of 
public  economy. 

If  it  should  be  said  that  a  science  must  be  of  universal  use,  to 
establish  its  claim  as  such,  it  will  be  observed  that  we  do  not  insist 
on  the  admission  of  this  branch  of  knowledsfc  to  that  rank,  if  it 
can  not  fairly  be  established  in  that  place.  We  do,  however,  main- 
tain, that  it  has  never  yet  arrived  at  that  position.  We  also  think  /  / 
that  it  may  be  brought  there  ;  and  we  beg  leave  to  suggest,  in  an-  •  • 
swer  to  the  requirement  of  the  attribute  of  universal  application  in 
a  science,  that  it  is  not  yet  concluded  to  be  wanting  in  this  case. 
One  of  the  conditions  of  this  science,  as  already  demonstrated,  is,  .  , 
that  every  nation  wishing  to  avail  itself  of  its  benefits,  must  look  for  /  ' 
its  elements  in  the  facts  of  its  own  history,  and  nowhere  else.  In 
that  way  it  becomes  of  universal  use,  when  every  nation,  for  itself, 
shall  have  constructed  its  own  system  of  public  economy  on  the 
basis  of  its  own  experience.  So  far,  therefore,  is  the  abovenamed 
objection  from  proving  that  public  economy  can  not  be  a  science, 
as  a  contingent  structure,  or  as  a  system  composed  of  contingent 
propositions,  it  may  be  seen,  that  its  very  nature  is  of  this  precise 
description  ;  in  other  words,  it  is  a  science  adapted  to  the  nature 
of  the  subject.  It  would  be  absurd  to  require  that  one  science 
should  prove  another.  It  is  sufficient  if  each  one  proves  itself,  and 
vindicates  its  own  position. 

It  must  be  admitted,  that  nothing  is  more  desirable,  in  public 
economy,  than  that  the  certainties  of  science  should  be  brought  to 
bear  upon  it ;  and  nothing  is  more  evident  than  that,  hitherto,  they 
have  never  been  so  directed.  The  reasons  are  obvious,  as  shown 
in  our  citations,  here  and  there,  from  Mr.  Mill.     It  was  impossible 


i^Ut^  €<^^  i^    (^2^    4tJi^U^^   2^  ^^    ^^^_ 


that  a  science  on  tliis  subject  should  be  constructed  out  of  the  com- 
mon experience  of  nations  for  common  use,  or  out  of  the  experi- 

-  ence  of  one  nation  for  the  use  of  another.  It  is  a  subject  on  which 
gener;ihzations  are,  as  Mr.  Mill  justly  observes,  even  "  abstractedly 
impossible."  It  is  only  in  the  line  of  the  experience  of  one  nation 
that  the  rigid  principles  of  such  a  science  can  be  applied,  and  for 
that  nation  only.  All  beyond  this  field  is  a  region  of  empirical  laws, 
as  before  shown  ;  and  of  that  precise  category  of  empirical  laws, 
which  are  utterly  incapable  of  being  reduced  to  a  science. 

While,  therefore,  we  do  not  claim  to  have  formed  a  science  on 
this  subject,  having  had  other  work  to  do,  we  trust  it  will  be  al- 
lowed, that  we  have  demonstrated  the  want  of  it,  in  establishing 
the  fact  that  all  pretensions  of  this  kind  hitherto  put  forward,  are 
without  foundation.  If  we  have  been  so  fortunate  as  to  indicate 
the  path,  and  open  the  door  to  the  field  where  alone  can  be  found 
the  elements  of  this  science,  it  will,  perhaps,  be  of  some  account 
iri  the  future  efforts  of  those  jvlio  may  find  it  convenient  to  under- 
take the  task  of  reducinij  it  to  form. 

It  can  not  be  denied,  that  some  study  and  close  thinking  are  re- 
quired for  the  use  and  application  of  the  canons  of  induction,  above 

•  cited,  to  so  intricate  and  complicated  a  subject  as  that  of  public 
economy.  Fortunately,  this  is  not  necessary  to  be  able  to  appre- 
ciate the  argument  ti)at  is  based  upon  them.  The  facts  and  rea- 
soning may  be  perfectly  apprehended  by  one  who  may  never  have 

^  heard  of  these  rules,  and  who  may  have  but  little  or  no  acquaint- 
ance with  the  processes  of  scientific  induction.  He  who  is  in- 
structed by  experience  and  observation,  is  capable  of  reasoning  as 
correctly  as  he  who  is  instructed  by  science,  and  often  does  so  with 
more  unerring  certainty  of  a  tiue  result.  Ex|)erience  never  leads 
to  error,  and  science  itself  is  verified  by  experience.  The  canons 
cited  above  grow  out  of  experience,  and  enforce  respect  and  credit 
only  as  they  are  conformed  to  it.  A  man  may  be  totally  ignorant 
of  the  canons,  when  his  experience,  or  the  experience  of  others 
verified  by  facts,  leads  him  to  the  same  result.  When  science  ac- 
cords with  experience,  it  settles  all  controversy.  Science  is  for 
those  who  occupy  the  higher,  and  who  are  capable  of  penetrating 
into  the  more  profound,  regions  of  human  scrutiny,  while  experi- 
ence is  for  the  common  walks  of  life. 

As  there  is  in  fact  but  one  great  argument  in  this  work,  com- 
posed of  various  branches  of  what  is  commonly  called  argumenta- 
tion, each  one  of  which  in  itself  is  an  argument  on  some  one  point, 


/ tK^vU   ^^'^IJl-^f-^t  ^^A^^^H  .     \P^/  J  fwVs-  ^\^    Lx^0U\. 


THE    NEW    POINTS    OF    THIS    WORK.  45 

or  in  some  one  line,  to  its  own  restricted  purpose,  it  will  be  obvi-  ^ 
ous  that  the  canons  above  cited  are  intended  chiefly  to  verify  the  , 
results  of  the  reasoning  on  the  main  question  between  Free  Trade 
and  Protection.  Though  common  judgment  is  for  the  most  part 
appealed  to,  and  it  is  hoped  may  be  relied  on,  to  produce  convic- 
tion, in  view  of  the  facts  presented,  and  of  the  reasoning  built  upon 
them,  there  is  always  a  class  of  minds  whose  habits  are  addicted  to 
scientific  investigation,  and  which  may  be  gratified  in  finding  that 
an  effort  of  this  kind  has  not  been  made  without  regard  to  what  are 
deemed  scientific  principles.  It  is  fair  to  conclude,  that  they  who 
are  capable  of  appreciating  these  principles,  will  also  be  sensible  '»' 
that,  as  the  science  applies  to  a  great  field  and  vast  amount  of  facts, 
and  to  a  protracted  period  of  history,  the  great  question  presented 
is  not  a  sim|)le  problem,  nor  extremely  easy  of  solution.  It  is  in 
fact  a  system  in  the  highest  and  most  comprehensive  sense  of  the 
term.  No  one  ever  became  master  of  geometry,  chemistry,  as-  • 
tronomy,  or  of  any  of  the  established  sciences,  witliout  some  pains, 
without  application,  hardly  without  vigorous  and  protracted,  effort. 
But  the  absolute  sciences,  if  such  a  distinction  may  be  made,  are 
incomparably  more  easy  than  a  contingent  one,  such  as  that  of  public 
economy.  Every  stage  of  reasoning  in  the  former  is  under  the  gui- 
dance of  immutable  laws,  and  it  is  not  easy  to  get  out  of  the  way  ; 
whereas,  the  pro[)Ositions  of  public  economy  which  may  be  most 
important  and  vital  to  any  and  whatever  nation,  are  undoubtedly 
contingent  on  a  variety  of  facts,  the  bearings  and  relations  of  which 
may  require  the  profoundest  attention  and  the  severest  scrutiny,  to 
be  well  understood  for  practical  purposes. 

4.   Another  of  the  new  points  made  in  this  work,  or  of  the  new  * 

positions  taken  —  we  are  not  particular  to  mention  them  in  the  ^r^ 
order  in  wliich  they  may  be  found  —  is,  that  labor  is  capital,  and 
the  parent  of  all  other  capital.  We  do  not  mean  that  this  is  a  new 
idea,  or  that  it  is  a  proposition  that  requires  proof.  But  it  has 
never  before  been  introduced  into  a  system  of  public  economy  as 
an  essential  element.  We  put  it  first  of  all ;  we  make  it  funda- 
mental. As  such,  it  pervades  the  entire  system,  without  which, 
established  in  its  own  proper  position,  any  system  of  public  econ- 
omy, as  will  be  found,  would  be  radically,  fundamentally  defective. 
We  profess,  that  we  could  not  begin  to  write  on  this  subject,  in 
any  hope  of  doing  justice  to  it,  and  of  corning  out  right,  without 
Grst  determining  the  true  position  of  labor  in  public  economy,  not 
only  as  capital,  but  as  the  parent  of  all  other  capital.     It  may,  in- 


1/  Kf  M-  ^  ♦^^^   «^  ''"^^  f^^  • 


K  's^  /yy^./siyi^*  J^c^U^U^  ^M^i<H.A^  ^  ^S^^w^^- 

/^  46 *,      THE    NEiV^POIXTS    OF    THIS    \^RK. ,      ^/    ^^    y^ 

^^^  deed,  be  said  that  the  technicalities  of  science  are  in  some  respects 
Vt"^^^"^  and  in  some  degree  arbitrary  ;  but  a  misnomer  in  science,  which 
^ .  for  ever  represents  one  of  its  chief  and  fundamental  elements,  not 

PJU^^  only  in  a  false  position,  but  in  a  position  which  puts  every  other 
//  I*Ij  element  out  of  place,  will  for  ever  be  fatal  to  the  proper  adjust- 
',  .  ment  and  right  view  of  its  parts.  Such,  we  think,  has  been  the 
''*'^^^  necessary  consequence  of  the  exclusion  by  economists  from  the 
'^-'^^  list  of  capitals  that  which  is  the  parent  of  all,  and  which  more 
^C44^  —  properly  deserves  the  name  alone,  than  that  its  mere  products 
^^#t^  should  have  superseded  it  in  the  nomenclature  of  art.  There  is  a 
^^{j,^^^ reason  to  be  deplored  in  this  malpractice,  a  moral  cause,  we  fear, 
which  aimed  for  ever  to  exclude  labor  from  its  rights.  It  reversed 
the  order  of  nature,  and  transferred  the  cause  to  the  place  of  the 
effect.  It  is  not  capital,  in  the  common,  or  in  what  the  economists 
have  made  the  technical  sense  of  the  term,  that  was  designed  to 
employ  labor,  and  in  this  condescension  to  enslave  it ;  but  it  is 
labor  which  in  nature  occupies  the  first  place,  and  which  was  de- 
signed to  be  the  employer  of  its  own  creations.  It  is  virtually  so 
always.  That  which  is  commonly  called  capital,  can  do  nothing, 
is  worth  nothing,  without  labor.  Labor  is  not  only  its  parent,  but 
its  efficient  and  vivifying  power.  But,  in  the  nomenclature  of  the 
economists,  labor  has  been  thrust  from  its  true  position,  and  as  a 
consequence  robbed  of  its  rights. 

5.  That  protective  duties,  in  the  United  States,  are  not  taxes, 
and  that  a  protective  system  rescues  the  country  from  an  enormous 
system  of  foreign  taxation,  are  both  new  points,  in  a  system  of 
public  economy,  though  not  new  ideas  —  and  points  of  great,  of 
vital  importance,  considered  at  large,  in  their  place.  The  rule  or 
principle  of  graduating  Protection,  also  presents  a  showing  that 
has  never  before  been  made,  in  w^orks  of  this  kind,  as  arising  out 
of  the  difference  in  the  joint  cost  of  money  and  labor  in  this  country 
and  in  those  with  which  we  trade. 

6.  A  very  important  point  is  made  in  this  work,  materially  affect- 
in  <>•  the  jreneral  argument,  in  a  consideration  of  the  different  states 
of  society  in  the  United  States  and  in  Europe,  which,  so  far  as  we 
know,  has  never  been  duly  weighed  as  an  element  of  public  econ- 
omy. Conjoined  with  this,  is  the  subject  of  education,  as  a  point 
which,  in  the  peculiar  aspects  of  American  society,  is  deemed  of 
great  importance,  and  an  element  that  has  never  had  its  proper 
position  in  the  consideration  of  this  subject. 

7.  Another  of  the  new  points  made  in  this  work,  is  the  founda- 

« 


^^  »■      •*-  ^jjj2    NEW    POINTS    OF    THIS    WORK.  47 

tion  of  the  value  of  money.  Every  theory  of  a  monetary  system  is 
almost  necessarily  a  castle  in  tlie  air,  independent  of  this  discovery, 
and  of  the  knowledge  that  flows  from  it,  as  a  guide,  as  a  principle. 
It  is  true,  indeed,  that  practical  men,  who  take  experience  and  ob- 
servation as  their  guide,  may  be  right  on  this  subject,  for  legislation 
or  for  financial  and  commercial  purposes,  as  is  often  the  case  on 
other  subjects,  without  knowing  why  they  are  so.  But,  in  the 
construction  of  the  theory  of  a  monetary  system,  and  in  the  eluci- 
dation of  its  parts,  it  is  scarcely  possible  to  avoid  errors,  which  may 
be  very  serious  in  their  consequences,  so  long  as  the  true  and  only 
secure  foundation  of  such  a  system,  is  not  understood,  nor  even 
discovered.  In  all  the  isolated  and  empirical  propositions,  as  to  ^ 
which  the  Free-Trade  economists  are  right  on  this  subject,  they 
are  so  by  the  accidental  sway  of  their  good  sense,  in  spite  of  the 
difficulties  in  which  they  are  involved  for  want  of  a  foundation  to 
stand  upon,  and  in  spite  of  the  defects  and  baseless  condition  of 
their  theory,  on  which  they  are  perpetually  falling  back,  to  float  at 
random  in  the  clouds,  a  prey  to  every  wind.  Practical  men  are 
generally  right,  though  they  do  not  know  why.  When  a  founda- 
tion is  laid  in  nature  for  man  to  stand  upon,  they  often  go  to  work 
there  without  understanding  the  reasons  of  its  firmness.  That  is  a 
good  bridge  that  carries  people  safely  over.  Accordingly,  it  has 
long  been  seen,  by  practical  men,  that  no  currency  can  be  secure 
and  permanent,  which  is  not  based  on  the  precious  metals;  but  it 
was  not  necessary,  for  practical  purposes,  since  they  w^xq  right  so 
far,  on  this  stage  of  causes,  really  but  an  effect  of  antecedent  causes, 
that  they  should  know  what  those  antecedents  were;  that  they 
should  understand  the  real  foundation  of  the  value  of  gold  and 
silver,  in  the  form  of  money.  To  them,  practically,  it  was  no 
matter.  But  for  a  theorist,  essaying  to  construct  a  monetary  sys- 
tem, to  be  incorporated  in  a  system  of  public  economy,  as  one  of 
its  fundamental  and  most  important  branches,  on  which  the  most 
momentous  results  in  the  legislation  of  a  state,  of  a  nation,  depend  ; 
for  such  a  pretender  to  sit  down  to  this  task,  without  knowing  any- 
thing of  the  real  foundation  of  the  value  of  money,  is  not  simply  • 
presumptuous,  audacious ;  but  alas  for  the  nation  that  is  doomed 
to  follow  in  the  path  of  his  precepts !  Such,  precisely,  and  no 
better,  on  this  point,  have  been  the  qualifications  of  the  Free-Trade 
economists.  Not  one  of  them  has  ever  understood  the  foundation 
of  the  value  of  money.  If  they  did,  they  would  certainly  have 
stated  it ;  and  if  they  had  seen  and  stated  it,  they  must  have  fol- 


« 


(1 


48  THE    NEW    POINTS    OF    THIS    WORK. 

lowed  its  leadings,  and  would  have  spared  the  world,  not  only  the 
errors  they  have  promulgated,  but  their  consequences. 

8.   Akin  to  this  new  point,  or  new  position,  as  to  the  foundation 
of  the  value  of  money,  is  another  we  have   made   and    urged,  in 
regard  to  the  distinction  between  money  as  a  subject  and  as  the 
instrument  of  trade.     This  naturally  grows  out  of  the  foundation 
of  its  value,  and  would   scarcely  be  discerned,  except  in  that  con- 
nexion ;  though  it  is  not  impossible  that  it  should  be.     This,  too, 
for  all  practical  purposes  of  the  commercial  world,  has  been  acted 
upon,  ever  since  a  common  currency  was  established.     Nobody 
can  find  a  time  when  it  was  not  acted  upon.     It  is,  therefore,  re- 
markable, even  marvellous,  that  a  truth  so  simple,  so  plain,  so  prac- 
tical, and  therefore  so  important,  should  never  have  been  recog- 
nised by  the  economists,  as  a  distinct  and  vital  element  in  a  mone- 
tary system,  and  consequently  in  a  system  of  public  economy.     It 
was  the  more  important,  that  it  should  be  recognised,  because,  for 
lack  of  it,  a  most  momentous  error  has  been  introduced  into  all  the 
systems    of   the    Free-Trade  economists,  beginning   with   Adam 
Smith,  and  running  down  tlirough  the   entire   school.     It   is  ap- 
parently the  principal  hinge,  certainly  one  of  the  chief,  on  which 
their  doctrine  of  Free  Trade  is  made  to  turn.     Not  making  this 
distinction,  they  assume  that  money  is  only  a  commodity  in  trade, 
and  that  it  occupies  the  same  position  with  all  other  commodities 
for  which  it  is  exchanged  ;  and  consequently,  that,  for  the  greatest 
wealth  of  parties  and   nations,   engaged   in   trade,  the   more  they 
trade  the  better,  whatever  commodity  they  part  with,  be  it  money 
or  anything  else.     This  doctrine  is  even  pushed,  or  naturally  runs, 
to  the  extreme,  that  the  more  a  party  buys  the  better,  as  buying  is 
only  one  side  of  trading,  and  necessarily  implies  that  of  selling. 
They  aver,  that  selling  money  is  precisely  the   same,  in  public 
economy,  as  selling  corn,  calico,  or  any  other  commodity,  that  is 
not  money  —  money,  according  to  them,  being  only  a  commodity, 
rankin"-   in   the   same  class   theoretically   and    commercially,    and 
occupying  the  same  position.     According  to  this  doctrine,  when  a  > 
party,  being  a  nation  or  o_tlier,  has  parted  in  trade  with  all  its  cash, 
it  is  so  much  richer"  andlill  "tfie  better  for  it;  as  it  retains  an  equiv- 
alent.    It  will   be  seen,  that  this  distinction  is  vital  to  a  system  of 
public  economy;  and   that  the   doctrine   above  indicated,   which 
fails   to   recognise   it,  and    which   confounds   the   two   things   put 
asunder  by  it,  forcing  them,  or  one  of  them,  into  a  false  position. 


%  * 

THE    NEW    POINTS    OF    THIS    WORK.  49 

must  necessarily  be 'fatal  to  any  party,  a  nation  or  other,  that  under-  *  *^  ^ 
takes  to  reduce  it  to  practice. 

9.  Another  of  the  new  points  of  this  work,  next  to  the  above- 
noticed  distinction  between   money  as  a  subject  and  as  the  instru- 
ment of  trade,  and  growing  out  of  it,  is  the  doctrine,  that  money, 
as  tlie  instrument  of  trade,  occupies,  in  every  commercial   com- 
munity, and  with  every  party  engaged  in  commerce,  on  a  larger  or 
smaller  scale,  comprehending  merchants  and  every  private  citizen, 
precisely  the  same  position  as  do  what  are  commonly  and  tech- 
nically called  "  tools  of  trade,"  in  any  specific  vocation,  such   as 
a  shoemaker's  kit ;  such  as  a  tailor's,  or  carpenter's,  or  mason's 
instruments ;  or  those  of  any  other  of  the  mechanic  arts ;  such  as 
the  implements  of  agriculture,  and  of  the  fisheries;  such  as  all 
the  craft  engaged  in  the  various  modes  of  navigation  ;  such  as  a 
lawyer's  or  physician's  library,  and  a  surgeon's  instruments  ;  or 
any  others  that  might  be  named  as  necessary  to  any  vocation  what- 
ever, under  the  name  of  "tools  of  trade."     It  is  never  pretended, 
that  any  business  of  life  can  be  carried  on,  without  its  appropriate 
"tools ;"  or  that  it  can  be  as  well  done  with  an  imperfect  as  with 
a  complete,  an  ample  set.     The    gold  and  silver,  separated  from 
the  great  mass  of  these  metals,  to  be  used  as  money,  are  placed  in 
this  position  solely  to   act  as  "  tools  ;"  this  is  the  beginning  and 
end  of  their  functions  as  money.     When  not  so  employed,  they 
are  of  no  manner  of  use,  and  of  no  value  whatever,  in  the  forms  of 
money,  except  that  for  their  intrinsic  qualities,  they  are  convertible 
to  some  of  the  other   uses,  in  which  their  value    chiefly  consists. 
But  while  occupying  the  position   and  discharging  the  functions 
of  money,  they  are  mere  "  tools."     Tools  of  what  ?     Of  trade,  of 
commerce.     And  there  are  no  other  tools  for  this  purpose,  since 
they  have  been  adopted  as  the  common  medium.     What,  then,  can 
a  man  or  a  nation  do,  in  the  way  of  trade,  without  them,  except  to 
fall  back  on  barter  ?     If  it  be  said,  that  the  trade  of  the  world,  and 
between  nations,  is  mere  barter  after  all,  still  it  is  no  less  true,  that     <^Pi^ 
gold  and  silver  are  the   "  tools"    for  negotiating  these  exchanges, 
and  they  can  not  now  be  accomplished  in  any  other  mode.     Every 
merchant's  books  are  kept  solely  in  the  denominations  of  money  ; 
and  there  is  not  at  any  time  a  commercial  exchange  negotiated,  in         ^ 
the  civilized  world,  large  or  small  in  amount,  in  which  the  values  jA^  // 
are  not  expressed,  and  the  balances  adjusted,  by  the  established  ^^Ji,^L_— 
denominations  of  this  common  medium.     Gold  and  silver,  or  their    £^€f9^  — 

/:Hv-(r->t_  ^^^H"^"^  .^A^^^^r^  ACik^  •^^i4.'^«-^^:<L_ 


>jUpp4^     C^O  .  THE    NEW    POTN-TfTOF    THIS    WORK.      ,^  ,     "^  C-^ 

yy^/*''''^^^      representatives,  are  the  "  tools  of  trade,"  all  the  world  over,  in 
commercial  transactions. 

And  yet  the  Free-Trade  economists  tell  us,  that  it  is  no  matter 
if  these  "  tools"  be  sold  ;  that  it  is  just  the  same  to  the  party,  as  if 
anything  else  were  sold  ;  that  they  are  only  commodities,  and 
occupy  the  same  position  as  all  other  commodities,  in  trade  ;  that 
he  who  sells  his  money,  gets  an  equivalent,  and  therefore  can  not 
be  injured  ;  and  that  it  is  a  positive  benefit  to  both  parties. 

10.  The  appropriate  functions  of  money,  in  defining  and  making 
them  palpable,  whereby  it  may  clearly  be  seen  when  money  is 
a  subject  or  the  instrument  of  trade,  constitute  another  point  of  this 
work,  not  before  made  sufficiently  clear,  if  made  at  all,  for  the 
practical  purposes  required.  We  have  defined  them  as  constitu- 
ting the  faculties  of  expressing  commercial  values  and  of  negotiating 
exchanges,  and  we  have  not  been  able  to  find  any  others.  When 
money  is  bought  and  sold,  as  a  subject  of  trade,  it  occupies  a  dis- 
tinct field,  and  the  same  position  as  other  commodities  in  trade. 
It  is  this  position  of  money  that  has  led  the  Free-Trade  economists 
astray  ;  or  it  is  this,  in  the  use  of  which,  by  their  mode  of  reason- 
ing, they  have  led  others  astray.  They  have  not  passed  from  this 
field,  as  they  should  have  done,  where  money,  as  a  subject,  is 
merely  on  its  march  to  the  field  for  which  it  is  destined  as  the  in- 
strument of  trade,  and  for  which  only  it  has  any  value  at  all  as 
money ;  they  have  not,  we  say,  passed  to  consider  its  position  and 
functions  in  this  latter  field,  where  it  acts  as  money,  and  constitutes 
the  great  moving  power  of  the  commercial  world;  but  they  have 
only  speculated  on  money,  while  in  its  passive  condition,  before  it 
has  begun  to  do  its  work  —  the  very  work  for  which  it  is  invoked 
from  the  great  mass  of  the  precious  metals.  They  have  considered 
it  only  while  on  its  way  to  this  destination.  In  all  these  stages,  it  is 
merely  a  subject  of  trade.  But,  when  it  comes  to  discharge  the 
appropriate  functions  of  money,  it  occupies  a  very  different  posi- 
tion, to  wit,  that  of  the  "tools"  of  trade. 

11.  Akin  to  this,  also,  is  another  new  point  we  have  been  obliged 
to  make,  viz.,  that  price  is  not  an  attribute  of  money,  does  not  be- 
long to  it,  while  employed  as  the  instrument  of  trade;  but  that  its 
appropriate  functions,  as  money,  are  to  prize  everything  else  that 
has  a  commercial  value,  or  to  express  that  value,  and  to  move 
such  values,  or  the  things  in  which  they  are  inherent,  forward,  in 
the  field  of  trade,  to  their  destinations.     We  have  found  it  abso- 

^"^  »  .lately  necessary  to  make  this  point,  in  order  to  rescue  that  part  of 


r. 


* 


THE    NEW    POINTS    OF    THIS    WORK.  51 

the  argument  on  which  it  bears,  from  the  profound  and  interminable 
confusion,  into  which  it  has  been  thrown  by  the  Free-Trade  econo- 
mists, by  ringing  the  changes  for  ever  on  the  price  of  money,  as 
high  or  low,  dear  or  cheap,  when,  as  the  instrument  of  trade,  it  has 
no  price,  and  no  measure  but  that  of  the  scales,  or  of  coins,  which 
is  the  same  thing.  The  world,  by  irrevocable  law,  and  for  suf- 
ficient reasons,  has  agreed  to  gold  and  silver  as  the  common  me-  ^€"^^^-6^'^ 
dium  of  trade,  and  in  all  commercial  transactions,  when  it  is  em-  ^ 
ployed  as  such,  the  question  is,  how  much  money  shall  be  given 
for  such  or  such  a  thing?  And  when  the  trade  is  concluded,  that 
is  the  price.  Of  what?  Of  the  thing.  Price  belongs  to  the  things 
for  which  money  is  given  in  exchange  ;  and  not  to  money,  while 
in  the  discharge  of  this  office.     The  confusion  is  endless,  and  with-    ^  '  f 

out  hope  of  relief,  when  price  is  made  the  attribute  of  both,  as  the    '  3»**  *- 
Free-Trade  economists  do  ;  and  they  do  it,  apparently,  evidently,    y  t^UW  ** 
indeed,  for  not  having  made  the  distinction  between  money  as  a      f    Li  C\  ~ 
subject  and  as  the  instrument  of  trade.     That  this  practice  is  an     /   *  i 

artifice,  to  make  the  mind  contented,  after  having  been  foiced  over       7-^1-^  • 
a  sea  of  doubt  and  darkness,  to  land  anywhere,  we  do  not  pretend 
to  say.     But  such  is  the  natural  effect. 

12.  We  have  endeavored  to  show  in  this  work  that  an  American 
protective  system  is  identical  with  Free  Trade  in  its  operation  and  f 
results,  as  the  latter  is  generally  understood  by  the  people  who  go 
for  it.  This  is  a  point  of  supreme  importance.  It  is  impossible 
that  the  masses  of  the  people  should  understand  this  subject  theo- 
retically ;  they  can  only  understand  it  as  they  feel  it  in  experience. 
They  know  when  they  are  blessed  with  prosperity,  and  when  they 
are  oppressed  for  the  want  of  it,  or  by  positive  commercial  evils, 
which  cluster  around  them,  and  bear  heavily  upon  them.  But 
they  can  never  understand,  scientifically,  how  these  different  states 
of  things  are  brought  about,  and  they  are  governed  chiefly  in  their 
opinion,  as  to  the  causes,  by  the  authority  of  their  party  leaders. 
All  they  want  is,  their  rights  ;  and  under  the  captivating  name  of 
Free  Trade,  they  are  often  led  astray.  They  think  that  in  this,  as 
the  name  seems  to  import,  they  have  a  greater  amount  of  freedom;  ( 
whereas,  as  shown  in  this  work,  the  reverse  of  this  is  the  rule. 
Protection  is  the  very  thing  they  are  after  under  the  name  of  Free 
Trade.  They  want  their  own  rights,  and  it  is  impossible  they 
should  enjoy  them,  except  as  they  are  protected  from  the  injurious 
and  calamitous  effects  of  foreign  cheap  labor  and  foreign  cheap 
capital,  which,  under  a  system  of  Free  Trade,  are  constantly  pour- 


r 


•i/^f 


52  THE    NEW    POINTS    OF    THIS    "WORK. 

ing  in  their  products,  to  throw  American  labor  and  American  cap- 
ital out  of  employment.  As  to  the  alleged  advantage  to  consumers, 
we  have  sliown,  too,  that  even  they  are  sufferers.  We  say,  then, 
that. the  very  objects  which  most  people  are  in  pursuit  of  by  Free 
Trade,  are  only  attainable  by  Protection. 
^  13.  We  have  endeavored  to  show  in  this  work  that  the  destiny 

0  "^-^  V'  of  Freedom  generally,  and  particularly  of  American  Freedom,  is 
yet  in  the  earlier  stages  of  its  career,  and  that,  for  the  people  of  the 
Unhed  States,  it  turns  chiefly,  if  not  entirely,  on  the  Protection 
of  American  interests  against  the  effects  of  Free  Trade.  This  is 
a  position  which,  with  the  light  that  is  capable  of  being  thrown 
upon  it,  makes  a  point  of  great  interest,  and  can  hardly  fail  to  ar 
rest  the  attention  of  profound  thinkers  and  enlightened  statesmen, 
who  love  their  country,  and  who  appreciate  the  means  by  which  its 

-  rJ^'i    •    Freedom  has  been  acquired,  and  by  which  alone  it  can  be  retained 
and  perpetuated. 

14.  We  have,  also,  endeavored  to  show  that  the  entire  struggle 
of  the  American  revolution  was  based  on  the  same  principles  as, 
and  that  the  controversy  between  the  British  crown  and  the  colo- 
nies was  identical  with,  that  which  is  now  carried  on  between  Free 
Trade  and  Protection.  This  is  a  point  which,  we  think,  can  not 
but  be  appreciated  ;  and  if  so,  it  is  of  itself  a  decisive  argument. 
If  the  objects  contended  for  in  the  American  revolution  are  indeed 
the  same  as  those  contended  for  by  Protection,  and  if  Free  Trade 
is  but  another  name,  under  which  the  claims  of  the  British  crown 
are  revived,  it  ought  to  be  enough. 

15.  We  think  we  have  seen  good  reasons  for  the  suggestion 
made  in  this  work  of  a  state  policy  existing  in  Great  Britain  for 
nearly  a  century  past,  the  object  of  which  has  been  to  sow  the 
seeds  of  Free  Trade  over  the  world,  that  Great  Britain  might  reap 
the  harvest.  The  history  on  this  point  is  curious,  and  full  of  in- 
struction. The  case  supposes,  that  British  statesmen,  having 
observed  the  benefits  of  Protection,  after  they  had  adopted  that 
policy,  and  foreseen  the  rapid  relative  advancement  of  their  own 
manufacturing  arts  to  a  position  that  might  bid  defiance  to  the  rest 
of  the  world  under  a  system  of  universal  Free  Trade,  did  conceive 
and  put  in  execution  the  far-reaching  purpose  of  employing  tiie 
most  eminent  talents  of  that  empire,  beginning  with  Adam  Smith, 
and  continuing  it  from  age  to  age  in  the  hands  of  different  persons, 
making  the  duty  imperative  on  the  Universities,  and  bringing  about 
a  general  sympathetic  action  among  their  own  writers  of  ability,  to 


THE    NEW    POINTS    OF    THIS    WORK.  53 

propagate  this  faith,  and  to  impose  it  upon  other  nations  for  the 
benefit  of  Great  Britain.  The  point  is  this  :  That  the  British  gov- 
ernment, through  agents  presenting  themselves  to  the  world,  in  the 
garb  of  scientific  men,  the  better  to  command  respect  and  attention, 
has,  for  nearly  a  century,  preached  Free  Trade,  not  from  a  convic- 
tion of  its  truth,  but  as  a  state  policy.  So  far  as  the  evidence  of 
probabilities  can  go,  the  sum  of  which,  when  they  are  chiefly  moral, 
is  often  the  strongest  and  most  conclusive  possible,  amounting  to 
what  is  called  a  moral  certainty,  this  case  is  one  which,  when  the 
facts  are  considered,  can  hardly  fail  to  make  an  impression,  and 
peradventure  command  belief;  more  especially  as,  on  any  other 
supposition,  the  facts  could  not  be  accounted  for,  and  as,  with  this 
interpretation,  they  stand  in  the  clearest  light.  It  has,  without 
doubt,  been  one  of  the  best  cards  of  statesmanship  ever  played  in 
the  councils  of  a  nation.  If  the  world  had  not  been  duped,  the 
conception  would  have  been  stultified.  That  it  has  commanded  so 
much  attention,  is  credit  enouo;h  for  its  authors  and  agents,  how-  y  v^  , 
ever  it  may  not  be  a  very  great  compliment  to  those  who  have  sur- 
rendered themselves  to  this  influence. 

16.  Akin  to  this,  and  involving  this,  w^e  have  also  made  a  dis- 
tinct point  of  the  reasons  of  the  rise  and  progress  of  the  theory  of 
Free  Trade,  which  is  the  leading  topic  of  the  chapter  which  treats 
of  the  abovenamed  point.  These  reasons,  as  they  have  presented 
themselves  to  us,  and  as  we  have  endeavored  to  present  them  to 
others,  are  not  more  curious  than  instructive.  The  transient  prev- 
alence of  this  false  theory,  is  no  more  wonderful,  than  that  false 
theories  of  astronomy  should  have  prevailed  for  ages,  for  centuries 
even.  The  history  of  error  is  often  as  necessary  to  truth,  as  that 
of  truth  itself. 

17.  Another  new  point  in  this  work  is,  that  freedom  consists  in 
the  enjoyment  of  commercial  rights,  and  in  the  independent  control 
of  commercial  values  fairly  acquired.     The  public  mind,  for  cen- 
turies, has  been  rife  with  the  vaguest  notions  of  freedom,  and  was,      yT   * 
perhaps,  never  more  so,  than  at  this  moment.     Under  its  sacred      /^     •g—^ 
and  attractive  name,  men,  to  a  great  extent,  have  been  chasing  a    %^4JtkA4 
phantom — an  impalpable  abstraction.    We  do  not  mean,  that  none  ,t4AJt^^i'%^ 
of  them  have  had  any  just  notions  of  it.     In  that  case,  we  should    jfmjLj  ^ 
despair.     We  only  tell  what  they  themselves  do  know  ;  we  give  a  /^^\ 

copy  of  their  experience  ;  we  define  the  thing,  that  they  may  not  't^^'t>4^V4 
err  in  the  pursuit.     Is  it  not  singular,  that  freedom  has  never  been    Ls-'C^CcMm 
defined,  so  as  to  be  palpable,  that  one  could  lay  his  hand  upon  it?  ^^ 


54  '  THE    NEW    POINTS    OF    THIS    WuRK. 

Nevertheless,  we  have  shown,  that  the  American  fathers  had  just 
notions  of  it,  as  a  practical  affair,  and  that  the  controversy  between 
them  and  the  British  crown,  was  about  commercial  rights  and  com- 
mercial values,  exclusively ;  that  no  people,  in  modern  times,  have 
ever  complained  of  their  government,  or  risen  up  against  it,  except 
on  these  grounds,  as  will  be  found  when  the  reasons  are  sifted  to 
the  bottom  ;  that  the  object  of  every  s})ecies  of  despotism,  even 
spiritual,  in  all  times,  has  been  to  rob  the  people  of  their  commer- 
cial rights  and  values  ;  and  consequently,  that  freedom  must  con- 
sist in  the  enjoyment  and  independent  control  of  them,  hy  those 
to  whom  they  fairly  belong,  who,  each  one  for  himself,  can  say  to 
all  parties,  to  all  :he  world,  to  unjust  claimants  especially,  they  are 
rnijie,  and  not  yours.  We  have  endeavored  to  show,  that  this  is 
the  great  question  at  issue  between  Free  Trade  and  Protection  ; 
that  the  former  is  identical  with  the  claims  of  the  British  crown 
against  the  American  colonies,  and  that  the  latter  occupies  the 
'same  position  with  the  Declaration  of  American  Independence,  as 
made  on  the  fourth  of  July,  1776;  that  Free  Trade  proposes  to 
revive  and  continue  the  same  old  system,  and  that  Protection  as- 
serts and  vindicates  the  rights  of  the  new  ;  that  these  rights  were 
the  objects  of  pursuit  by  those  who  aspired  to  Freedom,  for  centu- 
ries before  they  were  gained  ;  that  the  epoch  of  American  inde- 
pendence was  the  opening  of  a  new  and  important  era  as  it  relates 
to  freedom  ;  that  more  than  seventy  years  of  that  era  have  elapsed, 
and  the  question  supposed  to  have  been  setded  at  the  beginning,  is 
still  in  debate,  and  unsettled  ;  that  the  freedom  since  enjoyed,  is 
rather  one  of  form,  than  of  reality  ;  that  the  agitation  can  only  re- 
sult in  its  final  and  complete  establishment ;  that  experience  alone, 
long  protracted  and  disastrous,  can  settle  the  question  ;  that  it  is 
not,  properly,  and  can  not  be,  except  unnaturally,  a  question  be- 
tween domestic  pardes  of  this  country,  but  that  it  is  an  American 
question  ;  that  it  is  purely  a  question  of  freedom  ;  and  that  every 
k  •»  »  approximation  toward  Free  Trade,  in  the  United  States,  is  a  breach 

»  •       in  the  ramparts  of  freedom. 

•    "•*•'*.         18.   Akin  to  this  definidon  of  freedom,  is  the  necessity  of  an 

•  ♦N   ^>''        American  system  to  protect  it,  as  another  new  point  in  this  work. 

■*   *Vt^  \      ^®  ^"  ^^°'-  """^a"  an  American  system,  in  the  common  sense,  com- 

•      ^    prehending  a  policy  for  domestic  purposes  ;  nor  do  we  pretend, 

that  an  American  commercial  system  for  foreign  purposes,  is  a  new 

^i->  T  '^  *    idea  :  for  that  is  the  necessary  character  of  any  protective  system  ; 
but  we  mean  a  system  adapted  to  the  position  of  those  things  in 


THE    NEW   POINTS    OF    THIS   WORK.  56 

which  freedom  consists  ;  an  American  system,  properly  and  dis- 
tinctively such,  to  save  and  protect  what  has  been  acquired  of  free- 
dom, and  to  carry  out  its  designs  indefinitely,  for  the  future.  In 
all  history,  freedom  has  never  been  established  on  so  broad  a  plat- 
form, and  has  never  before  had  a  chance  to  take  up  so  favorable  a 
position  for  the  consummation  of  its  destiny,  as  in  the  United  States. 
But  it  would  be  a  great  mistake  to  suppose  that  that  destiny  is  al- 
ready accomplished.  Freedom  here  is  vulnerable  and  exposed  all 
round,  and  requires  the  shield  of  a  truly  American  system,  which 
is  directly  opposed  to  that  of  Free  Trade.  As  we  have  determined 
that  freedom  —  in  these  modern  times  at  least,  which  is  enough  for 
our  purpose  —  consists  in  the  enjoyment  of  conmiercial  rights,  and 
in  the  independent  control  of  commercial  values  fairly  acquired  ; 
and  it  being  assumed,  that  freedom  has,  apparently,  for  the  first 
time,  in  the  history  of  the  world,  gained  a  position  in  the  United 
States,  where  it  can  assert  these  rights  and  shield  these  values  with 
effect,  it  follows,  that  this  position  alone  is  but  a  stage  in  the  prog- 
ress of  freedom,  and  that  the  formation,  adjustment,  and  use  of  the 
shield,  is  quite  another  affair.  This  shield  we  hold  to  be  an  Amer- 
ican commercial  system,  formed  in  relation  to  the  foreign  world, 
and  adapted  to  the  position  of  the  commercial  rights  and  commer- 
cial values  of  this  country,  in  which  freedom  consists,  so  that  they 
shall  receive  no  damage  from  the  action  of  foreign  commercial  in- 
terests and  agencies. 

19.  Another  new  point,  which  has  seemed  to  us  of  no,  inconsid- 
erable importance,  will  be  found  in  the  argument  we  have  made,  to    fj  ^       1 
show,  that  Free  Trade  is  a  license  for  depredation,  because  it  is   ^V^JLK^^ 
based  on  the  principle  of  anarchy.     It  inhibits  law  on  a  field  where      -^ 

more  and  greater  interests  are  at  stake  than  on  any  and  all  others,   //>/•<*« 
and  puts  the  weaker  party  in  the  power  of  the  stronger  all  the  world  ^*^  ^ 
over,  so  far  as  this  domain  extends  over  the  rights  of  parties,  which  'TM^  ^* 
is  very  comprehensive.     By  the  mere  absence  of  law,  it  creates  a  /ItsAJ^ 
power  of  wrong,  which,  for  its  comprehensiveness,  energy,  and  for         g  g 
the  remoteness  of  its  influence,  is  unrivalled  among  all  the  known   ^""^"^ 
devices  of  injustice.     On  this  system,  a  strong  man  —  strong  in  his   C^'l^'CA^ 
commercial  position  —  living  under  one  national  jurisdiction,  may 
crush  hundreds  and  thousands  of  weak  men,  living  under  another 
jurisdiction  ;   and  the  operation  of  the  principle  is  without  limit 
over  the  face  of  the  earth,  till  the  rights  of  individuals,  in  countless 
groups,  and  those  of  whole  nations,  are  devastated  by  it. 

20.  It  has  been  thought  and  inconsiderately  confessed,  by  some 


56  THE    NEW    POINTS    OF    THIS    WORK. 

of  the  advocates  of  Protection,  tliat  the  United  States  can  afford 
Free  Trade,  in  proportion  as  their  manufacturing  arts  and  other 
improvements  shall  approach  that  degree  of  perfection  attained  by- 
rival  nations,  and  that  we  can  ultimately  afford  entire  Free  Trade. 
This  confession  overlooks  the  difference  in  the  cost  of  money  and 
labor  between  us  and  rival  parties.  No  matter,  though  we  come 
fully  up  to  our  rivals,  in  the  perfection  of  our  arts  and  other  im- 
provements, yet,  so  long  as  the  cost  of  money  and  labor  here  is 
one  hundred  per  cent,  more  than  in  other  quarters,  so  long,  indeed, 
as  there  is  any  excess  of  such  cost  among  us,  it  must  be  seen,  on 
a  commercial  principle  which  never  errs  in  its  results,  that  Protec- 
tion may  still  be  required  to  equalize  this  difference.  It  is  this 
difference  chiefly,  much  more,  certainly,  than  any  imperfection  of 
skill,  that  makes  Protection  necessary  in  the  United  States.  Some 
allowances  ought  doubtless  to  be  made  here  for  the  superior  advan- 
tage of  our  position  and  state  of  society ;  but  these  are  our  own 
property,  and  we  are  under  no  obligation  to  give  them  to  others. 

21.  We  do  not  claim,  that  the  prominence  we  have  given,  and 
the  importance  we  have  attached,  to  the  importation  of  agricultural 
products  and  labor,  in  the  form  and  under  the  disguise  of  manu- 
factures, is  a  new  idea,  as  we  have  acknowledged  our  obligations 
to  others  for  its  elucidation,  and  cited  their  reasonings.  Neverthe- 
less, it  has  never,  so  far  as  we  have  observed,  been  incorporated 
with  any  system  of  public  economy,  as  a  distinct  element.  It  is 
yet  to  be  seen  and  felt,  in  this  country,  that  it  is  one  of  the  most 
comprehensive  and  most  important  facts  to  be  considered,  in  the 
^  "'  debate  between  Free  Trade  and  Protection.  They  who  advocate 
Free  Trade  among  us,  dwell  with  much  emphasis  on  the  preten- 

j*^^         sion,  that  this  is  an  agricultural  country,  though  it  might  be  difficult 
to  see  how  it  is  more  so  than  most  other  parts  of  the  w^orld,  Europe 

■   **J''«^    especially.     They  say,  agriculture  is  our  interest  and  our  destiny; 

\  \  I  v,\  and  yet  they  advocate  the  importation  of  some  fifty  millions  of  dollars 
*  ^  a-year  of  agricultural  jjroducts  and  labor,  more  or  less,  in  the  forms 

»■  of  manufactures,  not  thinkino-   that  the  agricultural  interests  of  the 

United  States  are  thereby  robbed,  we  do  not  say  to  the  full  amount 
of  this,  but  certainly  to  a  very  large  part  of  it. 

Nature,  it  is  said,  has  indicated  the  natural  occupation  of  man  in 
North  America,  to  be  the  culture  of  the  soil.  As  if  nature  had  not 
given  the  same  hints  in  other  quarters  of  the  world  ;  as  if  the  count- 
less rivers,  streams,  and  waterfalls,  in  the  United  States,  had  given 
no  advice  on  this  point ;  as  if  the  lakes,  bays,  and  other  inland 


THE    NEW    POINTS    OF    THIS    WORK.  57 

water  channels,  did  not  invite  trade,  which  would  have  but  a  slen- 
der occupation  without  the  arts;  as  if  this  great  continent,  abound- 
in<r  in  all  the  resources  of  nature,  were  to  afford  no  other  sustenance 
to  the  human  family  but  the  milk  of  her  own  breasts  ;  as  if  all  its 
tenants,  like  the  aborigines,  served  by  women  in  a  state  of  bondage, 
were  destined  to  vegetate  on  corn  and  decay  for  want  of  employ- 
ment ;  as  if  the  Anglo-Saxon  race,  transplanted  to  another  and  a 
better  country,  would  consent  to  fall  behind  the  rest  of  the  world, 
or  allow  their  brethren  of  the  original  stock  to  outstrip  them  in  art 
or  enterprise  ;  as  if  that  people,  known  to  all  the  world  as  Ameri- 
cans, and  who  alone  are  thought  of  in  Europe  under  this  name, 
would  willingly  be  dependent ;  as  if  they  would  for  ever  sweat  and 
toil  in  the  field  to  supply  the  raw  material  for  a  more  delicate  and 
refined  race,  that  would  condescend  to  return  them  the  wrought 
product  wrung  in  agony  from  their  own  slaves,  at  a  cost  five  or 
ten,  sometimes  many  hundred,  and  even  many  thousand  times  en- 
hanced, and  draw  away  all  the  earnings  of  the  American  laborer  to 
pay  for  it ;  as  if  America  were  not  a  world  in  itself,  and  able  by  its 
ingenuity  and  skill  to  supply  every  luxury  as  well  as  every  neces- 
sity ;  as  if  the  lovers  of  freedom  had  turned  their  backs  on  the  old 
world,  to  become  more  abject  slaves  than  they  were  before  ;  as  if 
the  powers  of  invention  were  native  only  to  the  European  conti- 
nent, or  to  the  Eastern  world ;  as  if  the  moment  a  man  crosses  the 
sea  from  east  to  west,  he  is  doomed  to  suppress  all  the  nobler  fac- 
ulties of  his  soul ;  as  if  genius  and  art  could  not  flourish  in  the 
western  hemisphere  ;  as  if,  in  short,  America  were  fit  only  to  be 
a  dependent  colony  of  Europe.  A  people  without  art,  are  fit  only 
to  be  slaves,  and  are  easily  made  such.  A  nation  that  is  only  the 
producer  of  raw  materials,  can  never  claim  equality  with  nations 
which,  by  science  and  art,  add  many  values  to  those  materials,  and 
send  them  back  as  a  tax  on  those  who  consent  to  do  such  service. 

It  was  due,  therefore,  in  our  esteem,  that  a  system  of  public 
economy  for  the  United  States  —  we  do  not  profess  to  write  for  any 
other  country  —  should  fully  set  forth  the  greatness,  extent,  and  im- 
portance of  this  element,  which  consists  in  such  a  large  incorpora- 
tion of  agricultural  labor  and  products  in  those  of  manufacture. 
There  is  none  greater,  none^  perhaps,  of  equal  comprehensiveness. 
It  is  only  wonderful,  that  it  should  have  been  so  long  overlooked, 
and  that  we  search  in  vain  for  it  in  the  standard  systems  of  econo- 
my, though  it  claims  the  consideration  of  every  nation. 

22.  Another  very  important  point  of  this  work,  briefly  consid- 


58  THE    NEW    POI.VTS    OF    THIS    WORK. 

ered  in  the  first  chapter,  and  which  we  have  never  seen  stated  ex- 
cept hy  M.  Say  incidentally,  apparendy  without  a  thought  of  its 
bearino:  on  his  argument  for  Free  Trade,  is,  that  there  can  not  be 
two  kinds  of  economy,  one  for  private,  and  one  foi  public  purposes, 
any  more  than  two  kinds  of  morality.  We  maintain,  that  public 
economy  differs  from  private,  not  in  principle,  but  only  in  compre- 
hensiveness ;  and  that  the  difference  consists  in  the  fact,  that  in  the 
former,  more  things  are  to  be  considered,  and  more  relations  to  be 
ascertained,  than  in  the  latter.  Let  one  man's  business  be  extend- 
ed, and  variegated  by  a  great  number  of  interests,  as  is  often  the 
case,  and  his  system  of  economy  becomes  more  complicated.  In 
this  way,  it  approximates,  in  the  variety  of  its  interests,  to  a  system 
of  public  economy.  This  extension  may  be  supposed  to  go  on, 
and  the  interests  to  multiply,  till  the  system  is  as  broad  and  com- 
prehensive as  that  of  a  state.  States  differ  from  each  other,  in  the 
magnitude,  extent,  and  variety  of  their  interests,  as  much  as  some 
of  the  smaller  slates  differ,  in  these  respects,  from  the  largest  pri- 
vate estates.  But  a  private  individual,  in  the  extension  of  his  in- 
terests, and  in  the  increase  of  their  variety,  is  never  so  unwise  as 
to  introduce  a  new  kind  of  economy,  on  that  account ;  but  he  scru- 
pulously adheres  to  those  principles  in  the  application  of  which  he 
has  prospered.  It  would  not  only  be  hazardous,  but  ruinous,  to 
violate  them.  It  is  equally  hazardous,  and  equally  ruinous,  for 
states  to  violate  the  principles  of  private  economy  —  in  other  words, 
to  violate  the  principles  of  economy,  for  there  can  be  but  one  kind. 
And  we  have  not  only  M.  Say  with  us  here,  but  Ricardo,  who 
says  :  "  That  which  is  wise  in  an  individual,  is  wise  also  in  a  na- 
tion." We  have  never  found  a  point  of  difference,  of  any  impor- 
tance, between  us  and  the  Free  Trade  economists,  on  which  we 
could  not  cite  them  in  support  of  our  side  of  the  question-.  It  is 
because  they  could  not  say  so  much,  without  sometimes  saying  the" 
truth.  Some  economists  have  been  so  bold,  so  extravagant,  as  to 
maintain,  that  public  expenditures  are  good,  because  they  employ 
labor,  and  disburse  money  among  the  people,  even  though  the 
W'Ork,  when  done,  is  good  for  nothing ;  even  though  it  be  de- 
stroyed, as  soon  as  it  is  accomplished.  For  like  reasons,  some 
have  held  that  war  is  good.  The  economists  of  Louis  XIV.,  and 
the  king  himself,  defended  his  extravagances  on  this  ground  ;  and 
they  ruined  France,  economically  and  politically — the  last  as  the 
consequence  of  the  first.  If  public  expenditures  do  not  bring  or 
leave  a  quid  pro  quo,  they  are  equally  injurious  to  the  common- 


THE    NEW    POINTS    OF    THIS    WORK.  59 

wealth,  as  are  the  expenditures  of  private  individuals  to  them,  when 
they  realize  no  consideration. 

If  a  private  individual  habitually  buys  more  than  he  sells,  and 
keeps  running  in  debt,  every  one  can  see  what  will  be  the  result ; 
though  the  Free-Trade  economists  say  he  can  not  buy  more  than 
he  sells,  because,  if  he  does  not  sell  anything  else,  he  sells  money, 
and  that  money  is  nothing  but  a  commodity  in  trade.  But  money 
beino-  "  the  tools"  of  trade,  as  elsewhere  shown,  he  who  sells  his 
"  tools,"  can  trade  no  more,  except  by  barter.  All  know  the  con- 
venience and  necessity  of  money,  as  "tools,"  to  carry  on  trade  ac- 
tively and  most  profitably ;  and  this  necessity  is  limited,  or  gradu- 
ated, only  by  the  extent  and  kind  of  one's  business.  It  is  equally 
bad  for  a  nation  to  sell  the  money,  or  any  part  of  the  money,  which 
the  nature  and  extent  of  its  trade  requires,  to  keep  it  going,  and  to 
make  it  prosperous,  as  for  a  private  individual  to  do  the  same. 
The  principle  is  the  same  in  both  cases.  In  the  same  manner,  if  a 
farmer  can  not  sell  produce  enough  to  buy  all  he  wants,  he  must 
either  deny  himself  the  gratification  of  some  of  his  desires,  or  sup- 
ply them  by  his  own  labor,  even  though  it  cost  more  than  he  could 
buy  these  things  for,  if  he  could  sell  his  labor.  This  is  private 
economy,  and  public  also.  But  we  have  shown  elsewhere,  that,  in 
public  economy  for  the  United  States,  it  will  not  cost  more;  though 
it  would  be  true  economy,  even  if  it  should,  as  it  is  with  private 
individuals.  It  need  not  be  said,  that  that  which  is  nominally  the 
cheapest,  is  sometimes  the  dearest. 

We  have  thus  noticed,  in  this  chapter,  a  few  of  the  new  points 
made  in  this  work,  comprehending  those  we  deem  most  important, 
for  the  purpose  of  showing,  in  advance,  what  influence  they  are  en- 
titled to  have  on  the  general  argument ;  and  we  submit,  even  with 
the  imperfect  light  of  this  summary  statement,  whether  several  of 
these  points,  each  by  itself,  are  not  sufficient  to  decide  the  question 
between  Free  Trade  and  Protection.  On  some  of  these  points, 
particularly  the  first  three  stated  in  numerical  order,  which  are  not 
argued  in  cxtenso  elsewhere,  we  have  thought  proper  to  bestow 
more  attention  here,  as  being  of  special  importance,  though  not  to 
disparage  others  by  such  a  comparison,  quite  the  majority  of  which 
are,  in  our  esteem,  vital  and  fundamental,  running  through  the 
whole  line  of  argument,  and  pervading  the  work  as  principles. 


60  MEANING  OF  FREE  TRADE. 


CHAPTER    III. 

MEANING    OF    FREE    TRADE. 

The  domestic  Origin  of  the  popular  Application  of  tlie  Terms,  Free  Trade. — Their  Ad- 
Captandum  Features. — The  Unfairness  of  taking  Advantage  of  these  Features. — The 
true  Meaning  of  Free  Trade,  directly  the  Opposite  of  what  is  commonly  supposed. — Jus- 
tice on  the  Side  of  Protection. — Free  Trade,  to  be  Just,  requires  that  all  Nations  should 
be  one  Family. — Universal  Free  Trade  would  create  one  great  Central  Power,  at  the 
Expense  of  all  the  Rest. — Weak  Powers  can  only  be  defended  against  the  Strong  by  a 
Protective  System. — The  Free-Trade  Millennium  an  Absurdity. — Expensive  and  Cheap 
Organizations  of  Society,  as  they  affect  this  Q,ue.stion. — American  Instincts  on  the  Rights 
of  Labor. — The  Objections  to  Protection  are  the  Reasons  for  It. — The  Free  Trade  of 
Adam  Smith  not  the  Free  Trade  of  the  Present  Time. 

Much  is  saved  in  debate  on  any  question,  and  the  necessity  of 
debate  may  often  be  avoided,  by  a  right  understanding  of  terms. 
"  Free  Trade"  is  ostensibly,  and  in  itself  naturally,  an  ad-captan- 
dum  phrase,  especially  with  the  uninformed.  "  Free  Trade  and 
sailors'  rights,"  was  on  the  public  banners  of  the  war  of  1812,  and 
it  became  incorporated  with  the  heart  of  the  people.  Some  think 
that  "  Free  Trade,"  as  now  used,  in  opposition  to  the  protective 
policy,  means  the  same  thing  as  it  did  in  the  war  of  1812;  whereas 
it  then  had  reference  to  the  claim  of  the  British  government  to  visit 
our  merchant  vessels  on  the  high  seas,  search  for  British  subjects, 
and  impress  them  into  her  public  service,  by  which  means  Ameri- 
can citizens  were  often  impressed.  It  was  this  violation  of  the 
rights  of  American  seamen  chiefly  that  occasioned  the  war,  as  this 
"  right  of  search"  could  not  be  allowed  by  the  government  of  the 
United  States.  One  of  the  great  principles  involved  in  this  contro- 
versy was  freedom  of  trade  over  the  public  highway  of  the  seas, 
under  a  national  flag,  without  being  stopped,  visited,  searched,  or 
questioned,  by  the  public  vessels  of  other  nations  ;  and  the  other 
great  principle  was,  the  sacredness  of  the  rights  of  American  sea- 
men against  such  violation.  Hence  the  expressive  phrase  which 
came  into  vogue  at  that  time,  and  which  was  used  with  so  much 
power  and  effect,  "  Free  Trade  and  sailors'  rights,"  as  being  what 
the  nation  went  into  war  for,  and  for  which  they  were  stimulated  to 
maintain  the  contest.  It  is  very  unfair,  therefore,  to  take  advantage 
of  the  attachment  of  the  nation  to  such  a  principle,  by  using  the 
same  expression,  "  Free  Trade,"  as  if  it  meant  the  same  thing  now, 


MEANING  OF  FREE  TRADE.  61 

or  some  equivalent,  when  it  means  a  very  different  thing,  which, 
when  it  comes  to  be  understood,  will  rather  be  hated  than  loved; 
which  the  people  would  rather  fight  against,  than  for. 

There  is  another  reason,  consisting  in  the  captivating  influence 
of  the  phrase  itself,  and  of  its  different  forms,  which  leads  many 
minds  astray.  "  Free  Trade  ;"  "  freedom  of  commerce  ;"  "  free 
ports ;"  "  trade  where  and  with  whom  you  please ;"  "  buy  as 
cheap  as  you  can  and  sell  as  dear  as  you  can,  without  let  or  hin- 
derance  ;"  these  and  other  like  forms  of  phraseology,  consdtuting  a 
mere  cant,  when  employed  in  this  service,  seem  very  reason- 
able at  first  sight,  and  are  captivating  because  they  are  fallacious. 
The  idea  conveyed  by  these  phrases,  is  not  the  true  notion  of  Free 
Trade,  as  opposed  to  the  protective  principle  maintained  in  the 
United  States.  It  is,  on  the  contrary,  entirely  a  false  coloring  of 
the  subject.  Free  Trade,  as  now  used,  involves  a  question  of 
right  and  wrong,  of  justice  and  injustice,  not  between  parties,  both 
of  which  are  American,  but  between  all  Americans,  as  one  party, 
and  the  rest  of  the  world,  as  the  other  party.  It  being  assumed, 
that  all  Americans  are  interested  in  American  labor,  the  question 
is,  whether  American  labor,  which,  at  great  cost  of  blood  and 
treasure,  has  gained  an  independent  position  and  a  fair  reward, 
shall  be  again  reduced  to  a  condition  of  dependence  and  lose  its 
reward,  by  being  forced  into  a  competition  with  the  enslaved  labor 
of  foreign  nations,  especially  with  that  of  Europe,  the  comparative 
condition  of  which  is  set  forth  in  other  parts  of  this  work.  Or,  to 
put  it  in  another  form,  the  question  is,  whether  a  party,  once 
wronged,  and  having  by  its  own  virtue  and  energy  rescued  itself, 
shall  be  exposed  unnecessarily  to  the  same  wrong  again ;  whether 
it  shall  throw  open  its  own  doors,  and  give  free  entrance  to  robbers, 
because  they  choose  to  call  their  depredations  "  Free  Trade."  It 
is  indeed  "Free  Trade"  to  them,  by  such  consent,  with  profit;  .^j. 
though  it  can  not  be  profitable  to  the  party  that  is  robbed.  * 

"Free  Trade,"  then,  in  its  signification  as  now  used,  and  in  its         '     ■* 
practical  operation  on  the  people  of  the  United  States  is,  to  allow   ^    ... 
foreign  nations  to  bring  their  labor  for  sale  —  or  the  products  of  "*     ' 

their  labor,  which  is  the  same  thing  —  into  this  country  without  tax,      *  •  | » 
against  American  labor,  when  the  cost  of  the  latter  is  three  times 
as  much  as  that  of  the  former,  and  when,  besides,  it  is  taxed,  in    •        j 
the  maintenance  of  its  own  government,  to  purchase  for  foreigners  *,    , 

this    privilege;   in  other  words,  to  allow  foreigners  to   undersell*      ;, 
American  labor,  in  the  American  market,  and  thus  to  reduce  its     , .     j 


62  MEANING  OF  FREE  TRADE. 

price  and  reward  to  the  same  level  with  that  which  is  brought  into 
competition  with  it,  after  which,  as  will  be  shown  hrreafrer,  the 
American  consumer  gets  none  of  the  benefit  of  foreign  cheap  labor, 
while  American  labor  is  broken  down.  This  is  a  true  and  Aiir 
definition  of  "  Free  Trade."  It  is  virtually  a  toleration  of  injus- 
tice, and  that  of  the  worst  kind,  because  it  is  all  done  under  the 
mock  pretence  of  justice  and  fraternal  intercourse  ;  and  the  strangest 
•part  of  it  is,  that  this  toleration  should  be  consented  to  by  the  in- 
jured party. 

This  question  of  justice  may  be  further  illustrated  by  a  consider- 
ation of  the  great  and  comprehensive  fact  involved  in  the  obvious 
inequalities,  physical  and  other,  which  are  found  in  the  condiiion 
and  position  of  different  nations;  of  their  diverse  interests;  of  the 
dissimilarities  in  their  social  organization  ;  of  their  different  degrees 
of  improvement  in  productive  labor  and  in  the  productive  arts; 
and  of  the  necessity  of  taking  care  of  their  own  interests,  arising 
out  of  these  facts.  No  two  nations  are  equal  or  alike  ;  but  in  a 
thousand  particulars  are  unequal  and  unHke.  All  these  inequalities 
constitute  weak  and  vulnerable  points  on  one  side  or  the  other; 
and  all  these  dissimilarities  are  so  many  necessities  of  a  public 
policy  adapted  to  them.  Justice  demands  such  discrimination, 
and  it  would  be  very  great  injustice  not  to  employ  and  apply  it  in 
legisladon  and  government. 

If  any  choose  to  set  up  the  impracticable  theory,  based  on  the 
assumption  that  all  nations  are  one  family,   and  that  therefore  a 
system  of  perfect  Free  Trade  would  be  best  for  their  aggregate  in- 
terests—  which  is  the   romance   of  the  Free-Trade,  doctrine  —  it 
labors  under  the  disadvantage  of  encountering  two  insuperable  dif- 
/        S      Acuities,  first,  that  all  nations  are  not  one  family.     No  one  but  a 
^^\%/^^    visionary  could  reason  on  such  an  assumpdon.     Next,  the  prac- 
I  j|j^     tical  operation  of  such  a  theory  would  concentrate  the  wealth  of  the 
''l^  •       world  at  once  on  the  strongest  points,  and  withdraw  it  from  the 
r\^^/*    weakest.     It  would  make  the  young  and  weak  nations  slaves  to 
^    /t/f     ^he  old  and  strong,  and  the  tendency  would  be  to  give  one  nation, 
Ir^^^    .probably  Great  Britain,  an  ascendency  over  all  the  rest,  to  be  con- 
stantly, positively,  and   relatively  strengthened  in  that  position  ;  in 
other  words,  to  make  all  nations  tributary  to  one.     For  in  whatever 
^    jioint  or  points  any  one  nation  might  be  the  strongest,  at  the  com- 
.mencement  of  such  a  system,  she  would  not  only  be  able  to  main- 
''^'^^/•^'tain  that  superiority,  but  constantly  to  augment  her  relative  power 
0^^\  and  influence  in  these,  and  by  the  help  of  these,  in  other  particulars. 

^y^"^ ^hjUAM.  ^C^^/^-^^H-y    hr-lMi^   ^^-^i^-i— 


MEANING    OF    FREE    TRADE.  63 

It  is  possible,  indeed,  that  the  great  family  of  man,  as  one  family, 
might  accumulate  more  wealth  in  a  given  time,  under  such  a  sys- 
tem. We  will  not  pretend  to  decide,  as  it  is  quite  unnecessary. 
The  great  and  insuperable  objection  to  it,  is  that  the  wealth  and 
magnificence  of  the  world  would  be  concentrated,  at  the  expense 
and  by  the  impoverishment  of  nearly  all  its  parts. 

Such,  really  and  truly,  in  its  operation,  is  the  Free-Trade  theory ; 
and  such  would  be  its  natural  and  unavoidable  results.  It  would 
be  a  total  prostration  of  all  the  barriers  which  guard  and  defend  the 
interests  and  rights  of  particular  communities,  called  states  and 
nations,  always  putting  the  weaker  in  the  power  of  the  stronger,  up 
to  the  strongest  of  all,  the  last  of  which  would  absorb  the  control 
over  all  the  rest.  It  would  create  a  universal  dominion  for  one 
stupendous  power  —  which  could  easily,  and  would  naturally,  be 
converted  into  a  world-wide  despotism,  without  one  loose  fragment 
to  be  disengaged  from  the  sway  of  its  sceptre. 

But  it  is  thought,  by  reasonable  persons,  that  the  interests  of 
humanity  and  the  rights  of  man  are  best  protected  by  fortifying  the 
weak  against  the  encroachments  of  the  strong,  and  by  setting  up  all 
possible  barriers  against  that  "Free  Trade"  which  consists  in 
spoliation,  and  which  arms  only  the  mighty  against  the  defenceless. 
It  is  generally  thought  best  rather  to  multiply  independent  sov- 
ereignties, than  to  diminish  the  number,  by  allowing  the  greater  to 
swallow  up  the  less;  rather  to  surround  the  less  with  muniments 
of  defence,  than  to  rase  to  the  ground  those  already  standing.  It 
is  shown,  in  a  subsequent  chapter,  that  the  occasion  of  the  Amer- 
ican revolution  was  a  wrongful  absorption  of  the  commercial  values 
of  the  colonists  by  the  British  crown,  and  that  the  benefits  of  the 
acquisition  of  national  independence,  consisted  in  the  establishment 
of  a  power  competent  to  retain  and  defend  those  commercial  values. 
But  "  Free  Trade"  would  expose  these  values  to  be  drawn  away 
again,  and  again  to  be  absorbed  by  foreign  exchequers.  It  is  simply 
a  question  of  justice,  as  the  American  revolution  was  a  war  of  jus- 
tice—  of  justice  to  the  nation  and  to  the  people  —  and  precisely, 
identically  the  same  interests  are  at  stake  now  as  then.  "  Free 
Trade"  would  give  up  all  which  American  independence  acquired 
—  all  that  is  worth  bavins:. 

The  only  hypothesis  of  society  that  is  consistent  with  Free 
Trade,  is,  that  all  nations  should  be  equal  and  alike  in  all  respects. 
Can  anything  be  more  absurd,  than  a  theory  which  demands  this? 
It  requires  that  as  a  basis  which  is  not,  never  was,  and  never  can 


64  MEANING  OF  FREE  TRADE. 

be.  Even  if  a  universal  millenium  of  republican  institutions,  or  of 
any  otlier  form  of  government  that  might  be  thought  best,  after  all 
experiments,  could  be  brought  about,  so  that  all  nations  should  be 
exacdy  alike  in  their  social  organization,  without  the  slightest  dis- 
similarity, and  admitting  that  every  nation  should  have  made  pre- 
cisely equal  advances  and  improvements  in  the  various  applications 
of  labor  and  art;  still  the  physical  diversities  of  climate,  geography, 
geology,  mineralogy,  and  a  thousand  other  particulars,  entirely 
independent  of  social  organization,  which  would  necessarily  apper- 
tain to  each  nation  or  state,  creating  many  great  and  peculiar  in- 
terests, would  be  an  insuperable  bar  to  the  introduction  and  prac- 
tice of  Free  Trade,  and  would  occasion  very  great  injustice  to 
some  of  the  parties,  if  the  system  should  be  established. 

But  the  actual  social  dissimilarities  among  nations,  as  elsewhere 
shown  in  these  pages,  interpose  a  far  more  formidable  obstacle  to 
Free  Trade,  than  all  physical  differences.  This  constitutes  a 
greater  objection  in  the  United  States,  than  in  any  other  nation  that 
can  be  named.  The  high  prices  of  labor  and  capital  in  this  coun- 
try, are  the  results  of  a  cheap  social  organization,  or  cheap  govern- 
ment ;  and  the  effect  is  now  as  necessary  to  sustain  the  cause,  as 
the  cause  was  originally  necessary  to  produce  the  effect.  They 
are  now  reciprocally  cause  and  effect  of  each  other.  The  differ- 
ence between  this  state  of  things  and  that  of  Europe,  is,  that  what 
is  saved  by  cheap  government  in  the  United  States,  goes  to  the 
people,  and  what  of  commercial  values  is  extorted  from  labor  in 
Europe,  is  absorbed  by  the  governments  and  by  the  high  and  in- 
dependent classes  of  society.  In  Europe  the  wealth  of  the  wealthy 
and  the  power  of  the  great,  are  sustained  by  this  usurpation  of  the 
rights  of  labor.  In  the  United  States  the  rights  of  labor  were  in- 
tended to  be  protected  by  a  bar  to  such  usurpation,  which  consists 
in  social  organization  —  these  rights  being  always  understood  to 
be  commercial  first,  and  political  as  a  consequence,  or  because  they 
are  commercial.  The  moment  the  bar  adapted  to  this  position  of 
things,  and  to  these  interests,  is  removed  by  letting  in  Free  Trade, 
all  these  commercial  interests  of  the  people  of  the  United  States, 
which  consist  in  the  high  prices  of  labor  and  capital,  are  exposed 
to  be  reduced  to  the  level  on  which  the  same  things  stand  in  for- 
eign parts,  in  the  same  manner  as  water  of  different  heights  in  two 
adjunct  basins  comes  to  a  level,  by  the  removal  of  the  partition 
which  divides  them.  By  this  means  all  the  advantages  of  the 
social  organization  of  this  country  would  be  sacrificed,  lost,  swal- 


^ 


/^MEANING    OF    FRE^^TRADE.  65 

lowed  up ;  and  the  great  misfortune  would   be,  that,  as  the  water 
was  highest  in  our  basin,  it  would  flow  away  from  us,  and  none 
would  come  back.     When  foreign  labor  which  costs  one  —  nr  its 
products  which  are  the  same  thing  —  comes  into  the  same  market, 
on  a  Free-Trade  platform,  with  American  labor  which  costs  three 
—  or  with  its  products  which  are  the  same  thing — it  is  absurd  to 
suppose,  that  American  labor  will  still  maintain  the  relative  value 
of  three  to  one.     They  must  both  come  to  the  same  level.      The 
social  organization  of  the  United  States,  as  being  of  little  cost, 
would  then  be  of  no  value  to  the  American  people,  but  ail  the 
profit  would  redound  to  the  interests  of  foreigners  and  of  foreign 
potentates.     Or,  with  this  change  in  the  condition  of  the  people, 
before    independent,    now    abject,    would   come   a   corresponding 
change  in  their  character ;  and  with  these  changes  would  naturally 
follow  a  change  in  the  government,  from  cheap  to  costly,  and  from 
a  government  that  serves  the  people  and  obeys  their  will,  to  one 
that  would  serve  itself  and  follow  its  own  will.     In  other  words, 
as  Free  Trade  must  necessarily  reduce  the  American  people,  in 
their  condition  and  character,  to  the  level  of  foreign  abject  nations, 
so  would   it  elevate  the  American  government  to  the  same  height 
of  power  and  grandeur  with  foreign  governments,  to  be  independent 
of  the  people,  under  wliich  the  labor  of  the  people,  as  in  Europe, 
would  become  the  agent  of  power,  as  described  in  a  subsequent 
chapter.      For,   when  the  people  shall  have  surrendered   or  lost 
their  rights,  it  would  be  strange  and  unnatural  if  the  government 
should   not  usurp  the  high  and  independent  prerogatives  laid  at 
their  feet,  instead  of  yielding  them  to  foreign  powers.     The  social' 
organization  of  all  nations  accommodates  itself  to  the  condition  and' 
character  of  the  people,  and  will  correspond  with  it  whether  as 
cause  or  effect.     At  present  that  of  the  United  States  is  a  bar  to- 
Free  Trade,  because  the  condition  and  character  of  the  people  is 
inconsistent  with  it.     Their  instincts  make  them  aware,  that  they 
can  not  work  on  the  same  terms  with  the  poorly-fed,  ill-clad,  worse- 
housed,  and  uncultivated,  abject  laborers  of  foreign  parts.     It  is 
true,  indeed,  that  some  experiments  of  Free   Trade  have  been 
attempted  in  this  country,  by  approximation  ;  but,  as  will  be  shown 
hereafter,   every  such  experiment  has    brought  widespread  cala- 
mity in  its  train,  and  shaken  the  republic  to  its  centre  and  to  its 
foundations.     The  reason  of  these  disasters  and  convulsions,  so 
widely  and  so  profoundly  felt,  will  be  found  in  the  social  organization 
of  the  country,  and  in  the  condition  and  character  of  the  people, 

5 


»S'.  *,  ...  V  ^•'^  :   ^»  4*   ^  ♦/•.   ^  t  H  *  >  <*»  '^ 


66  MEANING  OF  FREE  TRADE. 


« 


they  being  incompatible  with  such  experiments,  and  incapable  of 
enduring  them  without  instinctive  alarm  and  sensible  effect,  as  if 
tending  to  dissolution. 

The  objections  to  the  protective  principle  are  the  reasons  for  it, 
in  the  United  States.  One  objection  is,  that  it  is  unjust.  One  of 
its  best  reasons  is,  that  it  is  the  only  way  to  secure  the  ends  of  jus- 
tice in  the  case.  What  could  be  more  unjust,  than  to  reduce  Amer- 
ican labor,  in  its  reward  and  condition,  to  that  of  Europe?  It  has 
been  averred,  indeed,  but  without  evidence,  and  with  the  sanction 
of  a  mere  hypothesis,  that  it  operates  unjustly  on  the  consumers  of 
protected  articles.  It  will  be  shown,  in  a  future  chapter,  that  Pro- 
tection, in  the  United  States,  is  no  tax;  so  that  the  only  objection 
that  can  be  raised,  on  the  score  of  justice,  falls  to  the  ground. 

It  is  also  alleged,  that  a  protective  system  —  M.  Say  stigmatizes 
it  as  "the  exclusive  system"  —  is  unfraternal  in  one  nation  toward 
another.  How  can  justice  be  unfraternal?  It  is  inequality  and 
dissimilarity  of  condition  and  circumstance,  which  render  such 
measures  necessary  to  prevent  injustice.  Can  fraternity  either  de- 
mand or  impose  anything  but  what  is  right?  Suppose  it  has  been 
found  necessary  to  protect  American  labor.  The  foreign  millionaire, 
who  has  robbed  the  labor  of  his  own  country  of  two  thirds  of  its 
fair  compensation,  and  who  by  that  means  can  afford  to  undersell 
American  labor  in  its  own  market,  complains  of  a  want  of  fraternity, 
because  the  American  government  will  not  let  him  do  it !  Frater- 
nity, in  such  a  case,  demands  loo  much. 

It  is  moreover  alleged,  that  so  long  as  nations  continue  their  tar- 
iffs of  Protection,  they  put  off  the  grand  commercial  millennium 
of  the  world,  universal  freedom  of  commerce.  This,  manifestly, 
is  in  some  sort  begging  the  question,  as  if  such  a  millennium  were 
of  course  really  desirable.  So  long  as  universal  freedom  of  com- 
merce would  operate  unjustly,  on  account  of  the  relative  inequality 
of  like  commercial  interests  in  different  nations,  or  on  account  of 
dissimilarity  in  their  respective  social  organizations,  there  does  not 
appear  to  be  any  sound  argument  in  favor  of  it.  A  millennium  of 
this  kind  may  be  a  very  fine  theme  for  declamation,  when  it  would 
be  very  bad  in  practice.  We  could  but  smile,  when,  in  our  hear- 
ing, one  of  these  declaimers  concluded  every  part  of  his  debate 
with  an  opponent,  with  the  assumed  triumphant  refutation  :  "  But, 
sir,  what  you  say  is  contrary  to  the  theory  ;"  that  is,  contrary  to 
the  Free-Trade  hypothesis  !     His  respect  for  this  assumed  dogma, 


'^yUC^J      ^C^V-^^  i-         *^  MEAMXG    OF    FREE    TRADE.  67 

was  greater  than  his  respect  for  fact ;  nor  could  he  give  weight  to 
a  fact  that  was  contrary  to  his  dogma. 

Ahhough  Adam  Smith  is  called  the  father  of  Free  Trade,  it 
will  be  found,  that  he  did  not  advocate  the  doctrine  in  the  sense  in 
which  it  is  now  used.  Indeed,  it  was  not  till  after  the  batde  of 
Waterloo  and  the  general  pacification  of  Europe,  that  this  Uto-  *y- 
pian  theory  was  attempted  to  be  put  in  practice,  under  the  influence 
of  Great  Britain,  whose  counsels  were  at  that  moment  predomi- 
nant. Europe  was  intoxicated  with  her  triumph  over  Napoleon,  by 
whose  sway  all  her  commerce  had  been  deranged,  and  she  run  wild 
in  the  hopes  of  a  new  era.  It  was  a  fine  chance  for  British  policy 
to  operate,  and  open  the  world  to  her  manufactures.  The  states 
of  the  continent,  emerging  from  the  chaos  and  disorder  into  which 
trade  had  so  long  been  plunged,  or  from  the  unnatural  condidon 
into  which  it  had  been  forced  by  the  will  of  one  man,  run  wild  with 
a  feeling  of  emancipation,  and  were  just  in  the  mood  to  be  caught 
by  the  fancies  of  the  Free-Trade  theory.  They  appeared  to  con- 
sent to  it  en  masse.  But  it  was  not  long  before  sad  experience 
brought  them  to  their  senses.  Russia  came  back  to  the  protective 
system  first,  under  a  most  able  report  from  the  hand  of  Count  Nes- 
selrode  ;  the  same  disappointment  and  reaction  brought  into  exist- 
ence the  German  Zoll-Verein  ;  until,  finally,  every  state  in  Europe 
pracdcally  rebelled  and  broke  loose  from  the  fatal  charm  by  which 
they  had  been  caught. 

In  proof  that  Adam  Smith  never  thought  of  Free  Trade  as  now 
taught,  observe  the  following  facts  :  The  first  thing  which  he  as- 
sails, in  his  work,  as  opposed  to  the  notions  of  Free  Trade  which 
•then  had  existence  in  his  mind,  is  the  incorporation  of  trades  or 
crafts  in  England,  as  practised  at  that  time,  and  as  has  been  con- 
tinued, to  some  extent,  down  to  the  present  period.  Most,  if  not 
all  trades  or  crafts,  of  any  considerable  importance,  were  incorpo- 
rated, such  as  goldsmiths,  saddlers,  tailors,  cabinet-makers,  fish- 
mongers, &c.,  &c.,  with  certain  privileges,  such  as  the  right  of 
making  their  own  by-laws,  and  governing  the  body  in  their  own 
way,  so  that  they  could  limit  their  numbers,  and  control  the  prices 
of  their  products  and  wares.  Under  this  system,  great  abuses  of 
privilege  were  imposed  upon  the  public.  This,  as  every  one  will 
see,  is  what  we  know  nothing  about  in  this  country,  no  such  thing 
having  ever  existed  here.  It  must  also  be  seen,  that  it  involves  a 
principle  endrely  different  from  that  of  duties  laid  on  imports,  for 
the  protection  of  domestic  against  foreign  trades.    We  have  shown, 


S       ■         i  ».    .. 

* 

68  MEANING  OF  FREE  TRADE. 

in  a  subsequent  chapter,  that  such  duties  in  the  United  States 
cheapen  the  prices  of  articles  protected,  instead  of  raising  them, 
and  in  a  thousand  ways  benefit  all  classes  of  the  community,  not 
excepting  the  consumers  of  the  protected  articles.  And  yet  it  was 
ao-ainst  this  incorporation  of  trades,  a  thing  so  entirely  different,  a 
^^  mere  municipal  regulation,  bad  enough  certainly,  that  Adam  Smith 
broke  his  first  lance,  in  the  cause  of  Free  Trade.  That  this  was 
always  in  his  mind,  as  a  starting  point,  and  as  a  general  basis,  ap- 
pears from  the  facts,  that  he  begun  with  it  in  Book  I.  Chapter  X. 
Part  2,  and  is  still  using  it,  in  Book  IV.  Chapter  III.  Part  2,  to 
enforce  his  Free  Trade  doctrine,  in  such  terms  as  the  following  : 
"  As  it  is  the  interest  of  the  freemen  of  a  corporation,"  such  as  the 
goldsmiths  of  London,  "  to  hinder  the  rest  of  the  inhabitants  from 
employing  any  workmen  but  themselves,  so  is  it  the  interest  of  the 
merchants  and  manufacturers  of  every  country  to  secure  to  them- 
selves the  monopoly  of  the  home  market,"  &c.  Having  started 
with  this  original  idea,  it  ever  after  seemed  impossible  for  him  to 
distinguish  between  the  principle  of  these  municipal  corporations, 
and  that  of  a  corporation  embracing  a  whole  nation,  where  the  latter 
chooses  to  take  care  of  itself  in  regulating  its  foreign  commerce. 
The  cases  are  totally  different,  and  yet  Adam  Smith  always  reasons 
as  if  there  were  no  difference. 

Next  we  find  him  very  justly  declaiming  against  companies  in- 
corporated for  foreign  commerce,  with  exclusive  privileges,  such 
as  the  Hudson  Bay  company,  the  South  Sea  company,  the  Royal 
African  company,  the  East  India  company,  &c.,  «&c.  All  these, 
clearly,  were  monopolies,  and  well  worthy  of  being  denounced  ; 
and  it  must  also  be  seen,  that  there  is  no  likeness,  in  fact  or  princi- 
ple, between  such  examples  of  restriction  and  the  protective  policy 
of  a  nation.  At  another  time,  we  find  him  railing  against  laws  pro- 
hibiting the  export  of  domestic  coin,  though  the  export  of  foreign 
coin  and  bullion  was  allowed.  Here  he  lighted  on  something 
which  was  not  so  easy  to  manage ;  and  like  an  excited  person, 
findino-  it  in  his  path,  be  resolves  to  put  it  out  of  his  way.  It  is 
true,  the  law  was  a  foolish  one,  and  so  far  as  it  was  intended  to 
prevent  the  payment  of  balances  against  the  country,  it  was  unjust. 
No  nation  should  allow  itself  to  be  caught  under  the  necessity  of 
such  a  law,  or  of  bank  suspension.  It  was  because  there  had  been 
too  much  Free  Trade,  that  Adam  Smith  took  occasion  10  make  an 
argument  in  favor  of  it.^ 


FREE    X«.ADE    A   LICENSE    FOR    DEPREDATION.  69 


0^     /^^"^&^     (C^!^'^>^'t^^^^t^^^--Pt^ 


CHAPTER   IV. 

FREE    TRADE    A    LICENSE    FOR    DEPREDATION    ON    THE    RIGHTS 

OF   OTHERS. 

This  a  New  Position. — It  is  based  on  the  Principle  of  Anarchy. — The  Essence  of  Free 
Trade  is  a  Plea  for  no  Law  over  an  important  and  wide  Domain  of  Interests. — Defini- 
tion of  this  Domain. — Nations  are  Commonwealths,  and  may  be  vulnerable  or  injurious, 
in  their  Relations  to  each  other,  the  same  as  Private  Individuals  in  each. — The  Defensive 
of  Man's  Position,  in  all  Circumstances,  requires  most  Care,  and  costs  Most. — Time  only, 
and  protracted  Experiment,  will  determine  the  relative  Merits  of  Free  Trade  and  a  Pro- 
tective System. — The  Point  of  Vulnerability  in  the  United  States,  opened  by  Free  Trade. 
— The  great  Problem  one  of  Fig^ures  and  Q,iiantiiies,  that  can  be  worked  out. — The 
Negative  Losses  occasione<l  to  Individuals  and  to  the  Country,  by  Free  Trade,  though 
Real  and  Serious,  not  easily  ascertained. — More  and  greater  Interests  at  Stake,  on  the 
Ground  proposed  to  be  given  up  to  Anarchy  by  Free  Trade,  than  anywhere  else. —  The 
Hen  and  Chick-ens  and  Hawk  are  like  Nations  and  Free  Trade. — How  this  Anarchy  of 
Free  Trade  operates. — It  is  real  Anarchy  quo  ad  hoc,  opening  a  vast  Field  for  Depre- 
dation.— Free  Trade  is  the  Sway  of  the  Will  of  the  Individual,  as  oppo.^ed  to  that  of 
Society. — The  Principle  of  Free  Trade  everywhere  at  Work  for  Depredation — Free 
Trade  not  equally  Fair  for  both  Sides. — Great  Britain  not  for  Free  Trade. — An  important 
Confession  of  a  Member  of  Sir  Robert  Peel's  Government. — The  Absurdity  of  making 
Laws  for  the  less  important  Sphere,  and  doing  without  Law  in  the  most  important. — 
The  Charge  of  Free  Trade  again.st  Protection,  falls  back  on  Itself,  in  precisely  the  same 
Form. — Under  Free  Trade  we  are  forced  to  buy,  in  the  Form  of  Manufactures,  the  same 
Things  which  we  produce,  while  our  Products  perish  on  Hand — Answer  to  Objections 
to  tlie  Theory  of  this  Chapter. — Free  Trade  operates,  through  a  second  Party,  to  injure 
a  third  Party,  and  the  Scope  of  this  Influence  takes  in  whole  Nations,  as  Subjects  of  its 
Depredations. 

It  is  proposed,  in  this  chapter,  to  pursue  a  line  of  argument, 
which  is  not  attempted  in  any  other,  based  upon  a  principle,  which, 
so  far  as  we  know,  has  never  before  been  applied  to  this  subject. 
An  argument  is  always  more  satisfactory,  when  the  principle  on 
which  it  is  based  can  be  distinctly  apprehended.  That  which  we 
have  in  view  to  invoke,  in  this  place,  is  as  well  known  and  under- 
stood as  any  other  in  the  social  state,  to  wit,  the  principle  of  an- 
arclnj.  It  will  be  found,  upon  examination,  that  Free  Trade  is 
based  upon  this  principle,  so  far  as  it  is  proposed  to  extend  its  do- 
main, simply  because  it  pleads  for  no  law.  If  the  ground  on  which 
it  is  designed  to  apply  this  system  were  unimportant,  and  no  inter- 
ests were  at  stake,  the  case  would  be  different.  But  it  is  evident 
enough,  from  the  interest  which  the  world  has  taken  in  this  ques- 
tion, for  ages  past,  and  from  the  increasing  interest  which  it  acquires, 
in  the  progress  of  events,  that  it  is  not  deemed  unimportant,  and  that 


t'*  70  FREE    TRADE    A   LICENSE    FOR    DEPREDATION  N 

"^  —  gre^t  Inter^sfs  are  ?iippo.^il"-to  be  involvel^/Vf  this  be  so,  it  would  ^ 
obviously  seem  strange,  that  anybody  should  propose  to  subject  this 
important  matter,  and  these  great  interests,  to  the  domain  of  anarchy, 
where  might  is  the  sole  principle  of  right.  One  is  startled  at  the 
idea,  and  could  hardly  believe,  if  the  fact  did  not  present  itself, 
that  such  a  purpose  could  be  seriously  entertained.  The  mind  of 
every  person  naturally  labors  under  the  suggestion,  and  would,  per- 
haps, fain  believe,  that  there  is  no  foundation  for  it.  Let  us  see 
whether  it  be  so. 
I  The  essence  of  Free  Trade  is  an  opposition  to  legislation  on 

foreign  commercial  intercourse.     What  is  this  but  a  plea  for  the 
non-existence  of  law,  as  to  the  subject  in  question,  and  as  to  the 
interests  concerned,  if  there  be  anyV     And  what  is  the  non-exist- 
ence of  law,  but  a  state  of  anarchy,  so  far  as  this  negation  of  juris- 
prudence extends?     It  is  not  pretended,  that  Free  Trade  pleads 
for  universal  anarchy  ;  for  it  does  not  assume  to  dictate  to  the  com- 
mercial transactions  of  the  domestic  sphere  of  a  nation,  however  it 
may  influence  them.     The  question  is  not  so  broad  ;  more  prop- 
erly, perhaps,  it  is  not  so  narrow.     Though  intrn-miiral  in  its  influ- 
ence, its  appropriate  domain  may,  perhaps  with  propriety,  be  called 
extra-mural,  or  without  the  bounds  of  national  jurisdiction.     It  will 
be  seen,  however,  that  it  always  stands  with  its  foot  on  the  line  of 
that  jurisdiction,  asserting  rights  within,  as  well  as  wielding  powers 
without.  •  It  claims  to  pass  this  line  without  law,  bringing  in  and 
carrying  out  what  it  pleases,  without  question  or  condition  ;  buying 
and  selling  in  both  these  quarters,  with  the  same  extent  of  privi- 
lege.     So  fir,  therefore,  as  its  appropriate  transactions  are  con- 
cerned, it  would  seem   to  assert  the  claim  of  being  without  law 
anywhere  and  everywhere,  within  as  well  as  without  every  national 
jurisdiction.     But  it  is  enough  for  our  purpose,  if  we  allow,  that 
this  claim  is  confined  to  the  passing  of  this  line,  to  and  fro,  in  its 
pursuits.     We  grant,  that  it  does  not  ask  to  be  exempted  from  the 
jurisdiction  of  a  state,  while  it  is  within  it ;  nor  from  that  of  the 
law  of  nations,  while  it  is  on  the  highway  of  nations ;  but  it  only 
claims  exemption  from  law,  as  to  the  subject  in  debate,  while  it  is 
passing  and  repassing  the  border  lines  of  every  national  domain.     It 
can  not  but  be  seen,  therefore,  that  the  claim  is  one  of  anarchy,  so 
far  as  the  question  extends,  which  merely  relates  to  the  conditions 
of  passing  and  repassing  a  line,  with  such  things  in  hand  as  may 
suit  the  person  or  party.     The  conditions  which  he  makes  are,  to 
go  and  return,  without  paying  for  the  privilege ;  iu  other  words, 


ON    THE    RIGHTS    OF    OTHERS.  71 

free  of  toll.     It  is  not  law,  but  its  non-existence.     The  turnpike  is 
thrown  open,  and  the  statute  is  laid  upon  the  shelf. 

We  are  aware  it  may  be  said,  it  is  pretty  nice  work  to  find 
anarchy  on  a  line.     What  more  can  be  asked,  it  may  be  demanded, 
than  to  obey  the  laws  within  a  given  jurisdiction,  and  not  to  violate 
the  established  code  of  the  civilized  world,  when  passing  from  one 
national  jurisdiction  to  another?      But  reflection  will  show,  that 
the  argument  can  not  be  fairly  concluded  in  this  way.     It  will  be 
found,  that  this  claim  to  pass  and  repass  the  lines  of  national  juris- 
diction, without  toll,  carrying  whatever  may  please  one  to  trade 
with,  on  either  side  of  those  lines,  affects  very  materially  the  in- 
terests, and  consequendy  the  rights,  of  the  great  and  minor  parties 
within  these  respective  jurisdictions.     Nadons,  as  one  grand  com- 
munity of  the  human  family,  occupy  similar  relations  to  each  other, 
as  do  tlie  individual  members  of  a  particular  society,  and  can  be 
injured,  in  the  same  manner  as  the  members  of  a  separate  com- 
monwealth in   their    relations  and   intercourse — injured  in    their 
separate  wholes,  and  in  the  parts  of  those  wholes — for  want  of 
protection  in  their  peculiar  position   and  interests.     Each  one  of 
these  nations  has  interests  to  defend  against  the  encroachments  of 
the  other,  in  the  same  manner  as  private  persons  have  in  the  com- 
mon relations  of  life  ;  and  the  experience  of  the  world  is,  that  the 
defensive  of  man's  position  and  rights,  whether  in  private  or  in 
public  relations,  is  more  important  to  him,  and  requires  more  care, 
generally  costs  more,  than  all  his  other  interests.     One  of  the  chief 
designs  of  society,  in  all  its  forms,  is  for  protection  in  these  par- 
ticulars.    A   man  does  not  want  society  so  much  to  prompt  his 
actions,  as  to  guard  his  acquisitions,  and  make  his  future  exertions 
profitable.     The  domestic  sanctuary,  and  the  home  estate  of  every 
individual,  owe  their  security  to  the  shield  of  law.     It  was  his  own 
agency,  or  that  of  his  ancestors,  which  created  these  benefits ;  it  is 
the  law  that  makes  them  valuable  as  a  future  reliance.     But  for  the 
law,  these  rights  would  be  exposed  every  moment ;  but  for  this, 
they  could  not  be  relied  upon  for  a  single  day.     One  rarely  sees, 
or   duly    appreciates,   the   benefits    of  society,   while    he    enjoys 
them.     Take  away  the  shield  of  law,  and  where  and  what  would 
a  man  be  ? 

The  operations  of  a  Protective  system  over  the  foreign  com- 
merce of  a  nation,  to  guard  and  defend  the  domestic  rights  of  its 
citizens,  are  of  the  same  invisible  and  inappreciable  character,  as 
those  of  common  law,  in  the  common  relations  of  life.     They  can 


72  FREE    TRADE    A    LICENSE    FOR    DEPREDATION 

not  be  felt,  with  a  lively  sensibility,  till  they  who  enjoy  them,  are 
deprived  of  them.     So  also,  the  first  effects  of  a  Free-Trade  sys- 
tem, are  so  indirect  and  complicated,  that  it  requires  some  close 
attention,   distincdy    and    fully  to    apprehend   them.       They    are 
necessarily  immeasurable,  because  there  are  no  palpable  rules  by 
which  they  can  be  ascertained  with  exactness  ;  though  the  ultimate 
effects  are  not  only  evident  enough,  but  overwhelmingly  so.     For 
example :  It  is   impossible  to  estimate  exactly  how  nmch  Amer- 
ican capital  is  thrown  out  of  employment,  or  turned  into  channels 
less  beneficial,  perhaps  injurious  to  the  public,  by  the  avalanche  of 
products  of  European  capital,  thrown  upon  the  country  by  Free 
Trade ;  or  exacdy   how   much  American  labor  has  been  super- 
seded, or  how  much  its  prices  have  been  impaired,  by  this  exces- 
sive importation  of  foreign  labor;  or  exactly  how  much  American 
arts  have  been  put  back,  by  this  system  of  dependence  on  foreign 
arts  ;  or  exacdy  how  many  forms,  or  what  extent,  of  profitable  enter- 
prises, employing  capital   and  labor,  have  been  suppressed  by  it ; 
or  exactly  how   much  the  country   has  been    impoverished   and 
weakened,  in  a  given   time,  by  the  same  cause;  or  exactly  how 
much,  in  the  same  time,  under  a  Protective  system,  it  would  have 
been  advanced  in  wealth  and  strength  ;  or  exactly  how  much  indi- 
viduals may  have  suffered  under  one  system,  or  how  much  they 
would  have  profited  under  the  other.     All  these  influences  are,  in 
a  manner,  impalpable,  and  their  first  effects  are  chiefly  negative. 
Who  can  exactly  measure  their  extent  and  magnitude  ?     But  the 
ultimate  effects  of  Free  Trade  are  evident  enough,  as  being  very 
great.      Our   history   demonstrates  it,   as  set  forth   in   subsequent 
parts  of  this  work,  in  the  general  prostration  of  the  business  of  the 
country  ;  in  a  wide  extent  of  commercial  embarrassment  and  bank- 
ruptcy ;  in  a  slack  demand  for  labor,  and  in  its  low  prices  ;  and  in 
the  general  distress  of  all  classes  of  the  people.     A  half-dozen  years 
of  Free  Trade,  or  of  a  defective  system  of  Protection,  have  never 
followed  each  other,  in  this  country,  as  our  commercial  history  will 
show,  without  bringing  with    them  these  painful  and   calamitous 
results  ;  and   ordinarily,  two  or  three  years   of  Free   Trade  are 
quite  sufficient  to  produce  them  all.     Short  crops  in  Europe,  as 
in  1S46  and  1847,  making  an  extraordinary  demand  on  America 
for  breadstuffs,  may  stay  this  result  for  a  season  ;  but  nothing  can 
avert  it,  in  an  ordinary  state  of  the  world. 

It  is  because  the   United  States  are  vulnerable  to  all  the  foreign 
world,  under  a  system  of  Free  Trade,  and  because  the  foreign 


ON    THE    RIGHTS    OF    OTHERS.  73 

world  is  aware  of  it.  Tiiat  vulnerability  consists  in  the  high  price 
of  our  labor,  and  in  the  imperfection  of  our  arts.  Open  these  two 
points  to  the  world,  by  Free  Trade,  and  there  is  no  escape  from 
the  consequences.  Europe  pounces  upon  us,  like  the  bird  or  beast 
of  prey  upon  its  victim.  With  her  cheap  labor,  she  can  break 
down  the  high  value  of  ours;  for  both,  on  the  basis  of  Free  Trade, 
are  in  the  same  market ;  and  therefore  make  this  result  a  necessary 
consequence.  It  is  a  simple  question  of  arithmetic,  or  of  mathe- 
matical quantities ;  and  there  is  no  more  certainty  in  figures,  or  in 
mathematical  results,  than  in  this  economical  problem  ;  for  both 
depend  on  figures  and  quantities,  and  are  decided  by  the  same 
principles.  Europe,  with  her  arts,  on  the  basis  of  Free  Trade, 
will  overwhelm  our  arts ;  that  is,  will  arrest  our  progress,  and  in 
some  things  put  us  back.  To  arrest  the  progress  of  a  nation  in 
arts,  in  wealth  and  strength,  is  a  negative  result,  and  therefore  the 
measure  thereof  can  not  be  easily  ascertained.  But  is  it  for  this 
reason  a  small  thing?  Where  a  nation  is  actually  put  back,  it  is 
more  obvious.  We  have  several  times  been  put  back,  in  this  very 
way,  as  shown  elsewhere ;  and  it  has  always  been  the  result  of 
Free  Trade. 

We  are  aware  that  Free  Trade  still  avers,  that  American  con- 
sumers of  these  products  of  foreign  cheap  labor  and  of  foreign  arts, 
have  the  benefit  of  the  cheapness  of  the  one,  and  of  the  superi- 
ority of  the  other ;  but  facts,  adduced  elsewhere  in  these  pages, 
show  that  this  averment  is  false  in  both  particulars.  As  to  the 
first,  foreign  producers  do  not  descend  upon  us,  except  at  points 
where  they  are  sure  to  beat  us,  not  only  retaining  to  themselves, 
after  the  struggle  is  over,  all  their  usurpations  of  the  rights  of  labor 
in  their  own  quarter,  but  in  the  end,  maintaining  their  prices,  be- 
cause, we  being  beaten  can  not  help  it ;  and  those  prices  are 
always  higher  than  for  the  same  products,  furnished  under  an 
American  system  of  protection,  as  we  have  elsewhere  demonstrated 
by  comparative  statistics  and  tables.  And  as  to  the  second,  viz., 
the  benefit  of  superior  arts,  we  have  also  proved,  that  American 
arts,  encouraged  and  sustained  by  Protection,  afford  us  not  only  ^ 

cheaper,  but  better  articles,  than  foreign  arts.  On  both  these 
points,  therefore,  which  are  the  chief  ones  —  indeed,  all  the  points 
of  any  importance  —  the  argument  for  Free  Trade  utterly  fails,  and 
that  for  Protection  is  established. 

It  is  not  so  much  to  drive  us  from  the  ground  we  have  already 
acquired,  under  a  Protective  system,  and  where  we  may  be  too 

•  ♦      •  '  ^  ^  \ 


f 


C\A 


74  FREE    TRADE    A    LICENSE    FOR    DEPREDATION 

Strong,  in  some  particulars,  to  be  ejected,  that  foreign  producers 
enter  the  lists  with  us,  when  that  system  is  prostrated ;  but  it  is  to 
arrest  the  growth  and  extension  of  our  arts,  to  discourage  new  enter- 
prises among  us,  and  to  supply  a  vast  field  of  our  new  and  increas- 
ing wants,  which  we  ourselves  could  and  should  supply,  both 
cheaper  and  better,  under  a  system  of  Protection.  It  is  in  this 
latter  field,  where  we  suffer  most  by  Free  Trade,  which  being,  for 
the  most  part,  a  negative  loss,  is  not  so  quickly  or  so  easily  per- 
ceived. Nevertheless,  it  is  a  real,  a  great,  an  immense  loss  —  a 
vast  and  comprehensive  depredation  on  the  rights  of  the  com- 
munity. The  principle  elsewhere  presented  in  these  pages,  that 
social  rights  extend  to  all  the  chances  of  the  future,  under  an 
equitable  system,  as  much  as  to  the  enjoyment  and  control  of  the 
acquisitions  of  the  past,  applies  here.  Free  Trade  destroys  these 
chances,  and  conveys  them  over  to  foreign  powers  and  foreign 
factors.  It  arrests  American  progress,  cripples  American  enter- 
prise, embarrasses  American  capital,  discourages  American  arts, 
and  impairs  the  rights  of  American  labor.  Its  march  is  stealthy  ; 
but  its  aim  is  sure.  Its  work  of  devastation  is  slow ;  but  in  the 
end  it  is  overwhelming.  It  is  not  till  years  have  rolled  away,  that 
a  nation,  guilty  of  this  folly,  reaps  its  harvest  of  public  and  private 
misfortunes. 

It  requires  no  little  knowledge  and  much  reflection,  to  appreciate 
these  negative  effects  of  Free  Trade.  For  example,  because  en- 
terprises, well  established,  are  not  broken  down  by  the  subversion 
of  a  Protective  system,  it  is  triumphantly  proclaimed,  that  the 
change  does  no  harm  ;  whereas,  a  just  view  of  its  effects  can  not 
be  had,  without  considering  how  many  other  important  enterprises, 
which  would  have  employed  much  labor,  and  brought  great  wealth 
to  the  country,  have  been  strangled  in  the  birth,  the  contingent 
benefits  of  which  are  not  seen,  because,  not  being  realized,  in  con- 
sequence of  this  change  of  system,  the  negative  loss  can  never  be 
known,  and  will  not  be  so  sensibly  felt  as  positive  losses  are. 

Free  Trade,  it  will  be  observed,  demands  a  state  of  anarchy,  of 
non-legislation,  on  ground  where  more  and  greater  interests  are  at 
stake,  than  on  any  other  in  the  wide  domain  of  civilization,  and 
where  the  difficulties  of  securing  and  protecting  the  rights  involved 
in  them,  are  more  formidable  than  anywhere  else,  on  account  of 
the  imperfection  of  the  law  of  nations,  and  on  account  of  the  power 
which,  in  such  a  state  of  things,  the  commercial  agencies  of  one 
nation,   may   have  over  the  commercial  rights  of  another.     The 


^.^^aa^  yM^AjUwA^, 


ON    THE    RIGHTS    OF    OTHERS.  75 

code  of  international  law,  important  as  it  is,  so  far  as  it  goes,  does 
not  approach  the  subject  now  under  consideration,  nor  does  it,  in 
any  particular,  provide  for  it.  This  is  a  ground,  over  which  Free 
Trade  demands,  that  there  shall  be  no  law  whatever,  and  claims 
for  it  the  arbitrary  sway  of  unbridled  license,  where  the  most  selfish 
passions  of  the  human  race  are  constantly  in  action,  and  excited  to 
the  highest  pitch  by  the  lust  of  wealth  and  power.  The  tempta- 
tions for  depredation  in  this  field  are  as  much  greater,  as  the  mag- 
nitude of  the  objects  and  the  chances  of  success  are  more  con- 
siderable than  in  other  quarters.  Under  the  ordinary  jurisdiction 
of  an  independent  state,  the  relations  of  society  are  defined,  and  the 
rights  of  its  members,  in  relation  to  each  other,  are  protected  against 
offenders.  But  Free  Trade  proposes  that  there  shall  be  no  code 
over  these  relations  between  nations,  so  far  as  commerce  is  con- 
cerned ;  though  it  can  not  but  be  seen,  that  the  commercial  rela- 
tions of  these  great  parties,  are  all  that  are  of  any  material  impor- 
tance as  subjects  of  legislation.  International  commerce,  be  it 
more  or  less,  is  composed  of  parts,  and  every  separate  transaction 
is  independent  of  every  other — is  private,  and  as  such,  is  a  transac- 
tion of  the  social  state.  It  can  not  be  said,  that  it  does  not  belong 
to  the  domain  of  law,  of  equity,  and  that  it  does  not  require  the 
supervision  of  authority,  and  the  protection  of  its  arm.  But  ac- 
cording to  the  dogmas  of  Free  Trade,  one  has  only  to  take  up  the 
position  of  "  an  outside  barbarian,"  and  he  may  with  impunity 
lay  his  hands  upon  the  commercial  rights  of  the  people  of  any 
nation  whatever,  if  by  any  means  he  can  bring  a  foreign  commer- 
cial agency  to  bear  upon  them  to  his  own  profit  and  their  injury. 
His  license  is  vested  in  his  position  as  a  foreigner.  He  acquires 
power,  in  every  country,  in  an  inverse  proportion  to  his  rights  there  ; 
and  having  no  rights  at  all,  his  liberty  is  uncontrolled.  The 
chances  are  a  thousand,  a  million  to  one,  that  he  will  find  plenty 
of  commercial  agencies  in  any  part  of  the  world,  any  one  of  which, 
according  to  this  system,  will  be  adequate  to  absorb  and  swallow 
up  a  countless  number  of  commercial  rights  in  any  other  part  of 
the  world.  The  innocent  hen  that  is  industriously  scratching  the  i 
earth  to  feed  her  interesting  family,  is  not  more  exposed  to  the 
bird  of  prey,  that  is  now  circling  through  the  air  above  her  head, 
and  which  will  the  next  moment  bear  aloft  in  his  talons  one  or 
more  of  her  charge,  than  is  every  man  within  the  bounds  of  civili- 
zation, to  the  Free-Trade  rovers,  who  darken  the  heavens  with  their 
baleful  wings,  to   live  on  plunder  wherever  a  nation.is  unwise 


er  a  nation.is 


76  FREE    TRADE    A    LICENSE    FOR    DEPREDATION 

enough  to  expose  itself  to  tlieir  rapacity  ;  and  there  is  just  about 
as  much  law  in  the  one  case  as  in  the  other.  It  is  for  want  of 
law,  in  this  particular,  and  only  for  that,  that  any  nation,  thus  ex- 
posed, is  perpetually  robbed.  Why  should  it  not  be?  And  who 
can  prevent  it,  so  long  as  she  herself  does  not?  By  the  case  sup- 
posed, she  has  thrown  away  her  shield  ;  or  has  not  taken  the 
trouble  to  keep  it  in  hand.  She  has  taken  the  word  of  the  roving 
bandits,  on  the  highway  of  nations,  that  they  are  all  honest  men  ; 
that  they  will  do  no  harm  ;  that  their  law,  which  is  anarchy,  is  the 
best  law  ;  that  the  hen  and  chickens  are  perfectly  safe  ;  that  no 
bird  of  prey  will  ever  descend  upon  them  ;  and  that,  though  they 
propose  to  come  among  them,  it  is  only  for  fair  exchange,  and  to 
leave  a  quid  irro  quo! 

Our  design,  in  this  chapter,  as  avowed,  is  to  illustrate  a  well- 
known  principle,  viz.,  that  of  anarchy,  in  this  particular  application, 
and  not  to  enter  largely  into  the  details  of  the  general  argument, 
which  have  their  place  in  subsequent  parts  of  this  work.  Our 
wish  here  is  to  show  the  absurdity  of  making  laws  for  the  citizens 
of  a  commonwealth,  in  their  relations  to  each  other,  and  of  attempt- 
ins:  to  do  without  law,  in  the  relations  between  citizens  of  different 
and  independent  commonwealths.  To  maintain  that  laws  are 
necessary  for  domestic  intercourse  and  not  for  foreign  ;  that  home 
trade  should  be  regulated,  and  foreign  not ;  that  a  rogue  who  cheats 
his  fellow-citizen  should  be  punished,  and  that  a  foreigner  shall  be 
free  to  come  in,  and  do  that  indirectly  with  impunity,  which  a 
citizen  may  not  do  in  any  form  ;  that  domestic  trade  shall  be  taxed 
for  the  entire  support  of  society,  and  foreign  trade  not  taxed  at  all, 
even  though  it  has  every  advantage  of  the  commercial  facilities  of 
the  country,  and  deprives  home  trade  of  all  which  itself  carries  on, 
and  home  labor  of  all  which  it  brings  in  ;  —  this,  certainly,  is  a  very 
extraordinary  system  of  hospitality  !  Is  it  not  one  of  the  most 
glaring  absurdities  that  ever  entered  the  mind  of  a  man,  who  did 
not  also,  for  the  sake  of  consistency,  advocate  the  abolition  of  all 
law,  that  all  parties  might  be  on  an  equal  footing? 

It  will,  perhaps,  be  said  we  are  dealing  with  a  shadow,  with  a 
nondescript  and  imaginary  department  of  the  social  state.  But 
that  can  hardly  be  called  imaginery,  which  impoverishes  or  en- 
riches a  nation,  an  effect  conceded  on  all  sides,  inasmuch  as  the 
aro-ument  between  the  parties  in  this  debate,  is,  as  to  which  of  two 
systems  will  do  the  one  or  the  other.  Nor  can  it  be  said,  that  the 
ground  we  speak  of  is  already  covered  by  law,  on  either  system. 


•  ♦      • 


ox    THE     PJGIITS    OF    OTHERS.  77 

That  it  Is  covered  by  law  for  other  purposes,  we  do  not  deny ; 
but,  quo  ad  hoc,  as  to  this  purpose,  the  very  question  is,  whether 
it  shall  or  shall  not  be  covered  by  such  authority.  Free  Trade 
forbids,  and  Protection  demands  it. 

If  it  be  still  asked,  where  is  the  ground,  what  is  the  field,  in 
question?  We  answer:  It  is  that  comprehensive  and  immense 
domain  of  commercial  rights,  which  appertains  to  every  independ- 
ent state,  in  its  peculiar  position,  interests,  and  institutions,  so  far 
as  they  are  peculiar,  and  consequently  its  own  property.  But  the 
peculiar  rights  of  this  wide  and  vast  field,  can  not  be  fully  ap- 
preciated, for  the  purpose  now  in  view,  till  they  are  regarded  as 
belono-ino;  to  the  individual  members  of  the  state,  the  sum  of  whose 
rights  of  this  description  constitutes  the  whole.  They  are,  in  the 
first  place,  the  property  of  the  nation  ;  next,  they  are  the  property 
of  the  individuals  of  which  the  nation  is  composed.  They  have 
cost  the  nation  much,  and  have  cost  every  individual  in  it  or  his 
ancestors  much,  or  somebody  with  whom  he  is  connected,  in  pro- 
portion to  his  stake  in  the  community,  and  he  is  perpetually  bur- 
dened with  a  system  of  taxation  on  their  account.  The  question 
between  Free-Traders  and  Protectionists,  is,  whether  these  pecu- 
liar rights  shall  be  maintained,  in  behalf  of  those  to  whom  they 
belong  ;  or  whether  they  shall  be  thrown  open  to  foreigners,  to 
whom  they  do  not  belong;  whether,  being  thrown  open,  foreigners 
shall  be  permitted  to  enjoy  the  greatest  benefit;  whether,  indeed, 
foreigners,  from  their  own  peculiar  and  advantageous  position,  shall 
be  permitted  to  make  these  rights  nearly  or  quite  valueless  to  citi- 
zens; whether  they  shall  be  permitted  even  to  oppress  and  enslave, 
after  having  robbed,  the  inheritors  artd  proprietors  of  these  rights. 
That  all  this  is  possible,  and  that  it  has  all  been  experienced,  none 
will  deny,  who  have  made  themselves  acquainted  with  the  recorded 
wrongs  of  the  North  American  colonists,  under  the  British  crown 
—  wrongs  which,  to  be  redressed,  cost  rivers  of  blood  and  mount- 
ains of  wealth.  That  much  of  this  has  been  experienced  by  the 
people  of  the  United  States,  even  since  the  achievement  of  their 
independence,  is  made  evident  enough  by  the  pages  of  our  com- 
mercial history,  citations  from  which,  for  this  purpose,  are  displayed 
in  subsequent  parts  of  this  work.  It  is  this  vast  field  of  rights, 
which  Free  Trade  proposes  to  give  back  to  Great  Britain,  back  to 
Europe,  back  to  the  entire  foreign  world,  by  striking  from  our 
statute-book  the  only  shield  of  protection  which  they  have,  or  can 
have.     It  is  in  this  manner,  and  so  far — too  far,  indeed  —  that  the 


78  FREE    TRADE    A    LICENSE    FOR    DEPREDATION 

principle  of  anarchy  applies  to  this  great  and  momentous  subject, 
and  threatens  unbridled  license  to  all  the  world,  for  depredation 
on  the  rights  of  a  great,  laborious,  long-suffering  people. 

That  the  principle  of  Free  Trade  is  one  akin  to  that  of  anarchy, 
it  is  only  necessary  to  observe,  that  one  of  its  technical  defiuitions 
of  itself,  is,  that  it  is  based  on  the  laissez-faire  precept:  that  is,  let 
things  alone  ;  let  them  take  their  own  course  ;  let  men,  quo  (id  hoc, 
do  as  they  please  ;  don't  embarrass  them  with  rules.  In  view  of 
the  fact  already  established,  that  there  is  no  department  of  the  com- 
mercial world,  which  has  so  much  influence  on  every  other,  for 
good  or  for  evil,  as  this  very  ground  which  is  in  contest  between 
Free  Trade  and  Protection,  of  the  truth  of  which  this  strife  itself 
is  a  sufficient  evidence  —  since  men  do  not  usually  contend  so  long 
and  so  earnestly  for  that  which  is  of  no  consequence  —  in  view  of 
this,  we  say,  one  would  think  it  could  hardly  be  pretended,  that  it 
is  a  matter  of  indifference,  whether  this  ground  be,  or  be  not,  cov- 
ered by  law  ;  much  less,  that  it  ought  to  have  no  law  at  all,  which 
is  the  claim  of  Free  Trade. 

We  shall  be  instructed,  not  a  little,  on  this  point,  by  a  consid- 
eration of  the  objects  of  all  law,  and  of  any  laws  whatever,  of  civili- 
zation itself,  in  all  its  parts  and  degrees,  and  of  the  improvements 
which  are  constantly  being  attempted  by  legislation.  These  ob- 
jects, let  it  be  observed,  are  always  to  get  away  from  anarchy 
—  to  be  further  removed  from  those  evils,  which,  at  any  given 
time,  are  experienced,  from  defects  of  law,  or  the  want  of  it.  Even 
a  bad  law  was  never  repealed,  and  society  was  never  dissolved,  for 
the  sake  of  going  back  to  anarchy.  Anarchy  is  that  state  of  things, 
which  all  lovers  of  order,  and'of  the  rights  of  the  social  state,  dread, 
and  fly  from,  on  the  principle  of  self-love  and  self-preservation  ; 
and  every  improvement  of  society,  by  legislation,  is  attempted,  with 
a  view  to  diminish  and  remove  any  remaining  evils  of  this  original 
state  of  things,  of  which  there  are  always  some,  under  the  present 
imperfections  of  the  social  state.  It  can  hardly  be  conceived,  that 
society,  in  its  legislation  for  laudable  purposes,  could  ever  have 
any  other  object,  than  to  limit  the  sway  of  the  will  of  individuals, 
and  to  establish  the  will  of  the  great  mass,  so  far  as  the  former  may 
be  opposed  to  the  latter.  The  first  is,  perhaps,  as  good  a  definition 
of  anarchy  as  one  could  give.  Nor  is  it  a  bad  definition  of  the 
principle  of  Free  Trade  ;  for,  let  it  be  observed,  that  this  principle 
is  not  confined,  in  its  applications,  to  foreign  commerce  ;  but  it  is 
found  everywhere,  invading  rights  of  the  social  state,  which  are 


ON    THE    RIGHTS    OF    OTHERS.  79 

imperfectly  defined  by  law,  and  if  possible  violating,  by  evasion  or 
open  breach  of  law,  even  those  which  are  not  only  distinctly  de- 
fined, but  universally  recognised.  It  is  the  reign  of  the  will  of  the 
individual,  as  opposed  to  that  of  society  ;  and  as  good  nien)bers  of 
society  are  not  in  the  habit  of  asserting  this  claim,  it  is  uniformly 
found,  when  found  at  all,  in  the  mouths  and  acts  of  bad  members. 
It  is  the  non-restrictive  system, "whether  found  in  the  ordinary  forms 
of  the  social  state,  or  in  that  great  and  wide  field  covered  by  foreign 
commerce,  in  both  of  which  the  fundamental  principle  is  the  same. 
And  this  principle  applies  not  only  to  the  present,  as  it  may  have 
arisen  out  of  the  past,  but  to  the  future,  as  it  may  arise  out  of  the 
present ;  not  only  to  rights  acquired,  but  to  the  chances  of  acquiring 
more.  Freedom  holds  more  precious  its  future  chances,  than  its 
present  possessions.  It  is  an  ambitious,  aspiring  spirit,  which  can 
not  brook  the  darkening  of  its  prospects.  What  did  the  American 
fathers  contend  for,  against  the  British  crown  ?  A  principle,  and 
that  on  account  of  its  prospective  influence.  It  was  not  the  past  or 
present,  so  much  as  the  future,  which  originated  and  sustained  that 
contest.  Every  citizen  of  a  free  country,  and  of  laudable  enter- 
prise, being  secure  of  the  present,  is  laying  his  plan  and  striving 
for  something  yet  unacquired,  regarding  his  future  position  and  in- 
terests, in  the  prosecution  of  which  he  has  a  claim  for  protection 
from  society ;  and  there  is  not  a  single  private  interest  in  the  land, 
which  is  not  reached  and  affected,  disastrously  or  otherwise,  by 
foreign  commerce  ;  not  one  —  that  of  the  importing  merchant  ex- 
cepted —  in  the  case  of  citizens  of  the  United  States,  as  shown 
elsewhere,  that  would  not  be  invaded,  impaired,  wronged  by  it, 
without  a  national  system  to  protect  it,  as  certainly  as  that  a  uni- 
versal depredation  on  the  rights  of  society,  without  resistance,  would 
be  followed  by  its  dissolution.  It  is  even  more  certain  ;  for,  in  the 
latter  case,  there  would  be  the  conventionalities  of  a  state  of  barba- 
rism, to  afford  some  protection;  whereas,  in  the  former,  the  parties 
acting  on  each  other,  would  be  too  remote  in  their  relative  position 
for  the  benefit,  even  of  such  conventionalities.  Just  in  proportion  to 
that  remoteness  of  position,  and  much  more  in  consideration  of  the 
fact  that  each  party  is  under  an  independent  jurisdiction,  should 
the  laws  of  foreign  commercial  intercourse  be  more  carefully  de- 
vised, and  more  rigidly  maintained  on  the  line  where  the  two  juris- 
dictions come  in  contact.  At  best,  there  is  a  chasm,  a  great  and 
impassable  gulf,  between  them,  so  that  an  injured  party  in  one  can 
not  go  for  redress  to  the  courts  of  the  other. 


80  FREE   TRADE    A  LICENSE    FOR    DEPREDATION 

Even  under  the  same  jurisdiction,  with  a  system  of  domestic  regu- 
lations intended  to  guard  the  rights  of  citizens  in  their  relations  to  each 
other,  every  person,  as  above  shown,  is  exposed  to  the  invasions  and 
depredations  of  the  principle  of  Free  Trade;  and  notwithstanding 
all  the  privileges  and  guaranties  of  law,  and  all  the  vigilance  of  pub- 
lic justice,  and  all  the  power  of  the  arm  of  public  authority,  he  is  a 
fortunate  man,  who  gets  through  life,  without  experiencing  the  ills 
of  Free  Trade.  For,  be  it  understood.  Free  Trade,  in  its  practical 
operations,  does  not  consist,  as  is  commonly  supposed,  in  buying 
where  one  can  the  cheapest,  and  selling  where  one  can  the  dearest ; 
but  in  taking  advantage  of  the  non-existence  of  law,  to  encroach 
upon  the  rights  of  others,  and  rob  them.  It  is,  at  bottom,  a  system 
of  roguery,  of  depredation,  either  in  a  field  where  there  is  no  law, 
or  by  the  evasion  of  law  where  it  exists.  In  this,  we  mean  only  to 
characterize  the  principle,  and  not  to  represent  the  character  of  all 
commercial  transactions  founded  upon  it. 

And  will  it  be  said,  that  Free  Trade  is  equally  fair  for  both 
sides?  And  can  not  those  who  say  this,  see  that  the  principle 
leads  directly  to  the  dissolution  of  all  society,  and  gives  the  field  to 
him  who  has  the  most  advantageous  position,  the  most  wit,  the 
strongest  arm  ?  Such,  undoubtedly,  are  the  results  of  Free  Trade. 
There  is  no  principle  of  the  social  state,  on  which  it  can  be 
founded.     It  is  virtually  an  unrestrained  license  for  depredation. 

But,  let  us  see,  if  Free  Trade  is  equally  fair  for  both  sides. 
There  can  not  be  found  two  nations  equally  advanced  in  the  arts 
and  in  the  facilities  of  producing  those  things  which  men  want  or 
desire,  and  consequently  must  have  ;  nor  any  two  in  which  the 
cost  of  production  is  the  same.  The  difference,  in  these  partic- 
ulars, between  some  nations,  is  very  great. 

The  question  involved  is  simply,  whether  the  comparatively  un- 
skilful and  weak  can  cope  with  parties  more  skilful  and  stronger, 
without  some  adventitious  aid  —  a  question,  the  very  statement  of 
which,  one  would  think,  ought  to  setde  itself.  Can  any  argument 
prove,  that  two  things  given  us  unequal,  are  equal  ?  How  is  the 
unpractised  and  comparatively  weak  pugilist  or  wrestler  to  en- 
counter, with  hope  of  victory,  his  skilled  and  athletic  opponent  ? 
How  can  a  Mexican  army  beat  an  American  army  of  equal  num- 
bers? This  is  the  question.  Great  Britain  by  a  protective  sys- 
tem, commenced  about  two  centuries  ago,  and  continued  down  to 
this  time  —  a  system  not  yet  abandoned,  notwithstanding  all  her 
pretensions  to  the  contrary,  and  never  designed  to  be  abandoned, 


ON    THE    RIGHTS    OF    OTHERS.  81 

except  as  she  succeeds  in  drawing  the  rest  of  the  world  into  the 
trap,  where,  though  caught  with  the  rest,  it  is  an  instrument  of  her 
own  contrivance,  in  which  she,  the  cat,  will  be  able  to  swallow  all 
the  birds  at  a  mouthful.  Great  Britain,  we  say,  has,  by  her  pro- 
tective system,  risen  to  be  the  richest  and  most  powerful  nation  on 
the  globe.  The  abolition  of  the  corn  laws  excepted,  the  only 
points  on  which  she  has  granted  Free  Trade,  are  those  in  which 
she  is  skilled  and  strong,  and  can  bid  defiance  to  all  the  world  ;  and 
this  she  has  never  done  without  the  formal  consent  of  the  parties 
concerned,  made  to  the  board  of  trade,  which  presides  over  all  such 
questions,  the  government  giving  to  those  parties,  at  the  same  time, 
a  boon,  in  the  abolition  of  duties  on  their  raw  materials  imported 
for  manufacture ;  so  that,  these  very  acts  were  in  fact  measures  of 
protection,  and  operated  as  such,  while  they  were  vaunted  forth  to 
the  world,  under  the  name  of  Free  Trade.  Even  the  abolition 
of  the  corn  laws  was  a  grand  measure  of  protection  to  the  empire, 
that  the  only  remaining  obstacle,  to  wit,  dearness  of  food,  to  the 
triumph  of  her  manufacturing  system  over  all  the  world,  might  be 
removed.  Thus,  every  step  of  advance,  on  the  part  of  Great 
Britain,  in  the  march  of  Free  Trade,  so  called,  has  been  to  her,  and 
to  the  parties  concerned,  a  measure  of  protection.  It  was  to 
strengthen  yet  more,  and  fortify  her  own  position  as  the  great  work- 
shop of  the  world.  She  has  never  abandoned,  and  never  will 
abandon,  her  system  of  protection,  though  she  is  the  only  nation 
that  can  afford  it.  It  is  absurd  to  call  that  Free  Trade,  every 
stage  of  which,  in  tlie  effect  of  the  abatement  of  British  duties, 
operates  on  the  parties  concerned,  as  a  measure  of  protection. 
The  Hon.  G.  Smythe,  associated  with  Sir  Robert  Peel  in  the 
government  of  Great  Britain,  and  who  went  with  Sir  Robert  in  all 
his  measures,  called  Free  Trade,  candidly  said,  in  a  speech  at 
Canterbury,  on  the  state  of  the  nation,  in  the  summer  of  1847  : 
"  I  can  not  quit  this  subject  of  Free  Trade,  without  expressing  my 
opinion  on  its  abstract  principle.  I  by  no  means  hold  that  the 
principle  of  Free  Trade  is  absolutely  true,  or  that  it  is  of  universal 
application.  If  I  were  an  American,  the  citizen  of  a  young  country, 
I  should  be  a  protectionist.  If  I  were  a  Frenchman,  the  citizen 
of  an  old  country,  with  its  industry  undeveloped,  I  should  equally 
be  a  protectionist."  So  here  we  have  the  truth  from  one  who 
knows,  and  who  could  say,  of  all  the  self-styled  Free-Trade  move- 
ments of  Great  Britain,  mogna  jxirs  fui.  Yet  he  confesses,  that 
there  is  nothing  in  the  principle  of  Free  Trade  of  general  applica- 
6 


82  FREE    TRADE    A   LICENSE    FOR    DEPREDATION 

tion,  and  that  the  doctrine  is  a  false  one.  He  would  be  a  protec- 
tionist in  America,  in  France,  and  doubtless  in  any  other  country, 
not  excepting  even  that  of  Great  Britain,  where  he  advocated  the 
abolition  of  protection  only  over  certain  parties  who  were  prepared 
for  it  in  the  strength  of  their  position.  This  represents  the  true 
state  of  the  question,  as  being  entirely  one  of  expediency,  con- 
tino-ent  on  circumstances,  and  not  one  of  fixed  and  determinate 
principles,  for  general  application.  It  is  solely  a  question  of  com- 
parative strength  of  position,  all  things  considered,  and  not  a  doctrine 
that  can  be  relied  upon  in  all  or  in  any  cases.  If  beneficial  to  one 
party,  it  might  for  that  very  reason  be  injurious  to  all  others,  and 
to  some  very  disastrous. 

The  leaving  of  this  important  field,  unprotected  by  legislation, 
is  the  same  as  surrendering  it  to  lawless  rovers  and  commercial 
bandits.  It  invites  them  in,  and  creates  their  characters  as  depre- 
dators on  the  rights  of  American  citizens.  They  are  received  and 
hospitably  entertained,  while  they  prey  on  the  vitals  of  the  com- 
munity whose  guests  they  are.  There  is  no  law  prescribing  terms 
of  their  entrance  ;  for  it  is  the  condition  of  Free  Trade,  that  there 
shall  be  none  ;  and  being  here,  with  all  the  advantages  of  the  places 
whence  they  come,  they  cripple  the  citizen  and  tie  up  his  hands  ; 
take  from  him  his  living  and  his  bread,  while  the  citizen  pays  all 
the  taxes  of  that  state  of  society  which  secures  to  the  foreigner 
these  advantages  over  himself. 

But  how  do  foreigners  commit  these  depredations  on  the  rights 
of  the  people,  under  a  system  of  Free  Trade?  In  what  manner 
does  it  operate?  In  the  first  place,  it  forces  the  people  to  pay 
more  for  what  they  buy  of  foreigners,  when  it  supersedes  a  domestic 
product,  notwithstanding  that  Free  Trade  alleges  that  they  pay  less. 
Facts  prove,  that  Protection  wields  a  comprehensive  and  sweeping 
influence  of  this  kind,  which,  in  a  course  of  years,  after  domestic 
competition  has  had  time  to  operate,  produces  a  very  sensible  and 
a  very  material  change;  and  it  is  rarely  true,  that  the  prices  of 
such  articles  are  raised,  even  at  the  beginning  of  a  system  of  pro- 
tection. For  it  is  found,  by  experience,  that  although  the  prices 
of  some  of  the  articles  in  question,  are  sometimes  transiently  cheap- 
ened by  the  removal  of  Protection,  they  are  scarcely  ever,  if  in  any 
case,  enhanced  by  the  establishment  of  a  protective  system.  The 
cheapening,  in  the  first  place,  is  the  result  of  a  competition,  in  an 
unsetded  state  of  things,  which  can  ordinarily  be  but  of  short  dura- 
tion ;  and  the  continuance  of  prices  on  the  same  level,  and  some- 


ON    THE    RIGHTS    OF    OTHERS.  83 

times  the  reduction  of  them,  in  the  latter  case,  results,  first,  from 
the  competition  between  the  domestic  and  the  foreign  producer,  the 
latter  of  whom  will  still  try  to  hold  on  to  the  market ;  and  next,  by 
a  domestic  competition,  when  the  home  production  is  well  estab- 
lished.     This  is  acknowledged  by  both  Say  and  Ricardo. 

The  doctrine  of  Free  Trade,  on  this  point,  is  thoroughly  falsified 
by  facts,  and  the  war  is  turned  back  on  Africa.  It  is  a  just  and 
grievous  complaint,  that  Free  Trade  costs  more  than  Protection, 
in  the  very  articles  which  it  claims  to  cheapen,  and  the  alleged 
cheapening  of  which  constitutes  its  only  plea.  Free  Trade  not 
only  imposes  an  additional  burden,  where  it  promises  to  remove 
one  ;  but  it  prevents  the  establishment  of  a  system  which  would 
make  that  burden  less  than  it  was  before,  being  thus  aggravated  by 
Free  Trade.  Instead  of  rescuing  us  from  foreigners,  it  puts  us 
back  into  their  power ;  instead  of  giving  us  a  chance  of  getting 
things  which  we  want  at  a  fair  price,  it  forces  us  to  pay  the  ex- 
penses of  European  thrones  and  institutions,  usurped  from  the 
rights  of  labor ;  and  thus  a  positive  tax  is  imposed  upon  the  country, 
by  Free  Trade,  instead  of  relieving  it  from  one.  It  may  easily  be 
seen,  that  an  American  system  of  adequate  protection,  ought  to 
give  us  articles  of  manufacture  cheaper  tlian  Europe  would  do, 
with  her  onerous  institutions,  so  long  as  she  might  have  control  of 
our  market.  In  that  case,  she  is  sure  to  make  us  pay  her  taxes, 
as  we  always  do,  under  a  system  of  Free  Trade.  Here  is  the 
cause  which  accounts  for  the  fact,  that  whenever  the  protective 
policy  has  prevailed  in  the  United  States,  our  manufactures,  before 
obtained  from  abroad,  have  been  cheapened,  and  continued  to 
cheapen,  as  long  as  that  system  was  sustained.  The  prices  cur- 
rent of  the  same  articles,  at  any  given  time,  in  Europe  and  Amer- 
ica, under  an  American  protective  system,  can  not  fairly  be  brought 
to  bear  upon  this  question.  The  differences  prove  nothing,  ex- 
cept the  natural  effects  of  a  limited  market  for  European  products, 
and  that.  If  we  would  give  them  our  market,  they  would  imme- 
diately raise  their  prices  ;  nor,  as  before  remarked,  do  the  transient 
effects  of  disturbing  our  system,  by  abolishing  Protection,  prove 
anything  reliable  on  this  point.  It  is  only  the  high,  comprehensive, 
permanent,  and  controlling  influences  of  a  system,  which  are  to  be 
regarded  in  such  a  case,  and  which  claim  the  attention  of  a  states- 
man, to  guide  him  in  a  safe  path  for  the  service  of  his  country.  By 
this  rule,  the  facts  arrayed  in  other  parts  of  this  work,  prove  con- 
clusively, that  an  American  Protective  system  rescues  the  country 


84  FREE    TRADE    A    LICENSE    FOR    DEPREDATION 

from  the  immense  and  onerous  system  of  European  taxation,  in 
the  prices  of  the  very  articles  which  Free  Trade  falsely  claims  to 
cheapen.  Nor  is  there  any  exception  to  this  rule,  injurious  to  any 
parties  in  the  country  whatever,  rich  or  poor,  individual  or  asso- 
ciate, or  sectional;  because,  as  elsewhere  shown,  the  general  and 
comprehensive  benefit  of  a  Protective  system,  operating  upon  all, 
more  than  indemnifies  for  any  transient  and  inconsiderable  burden, 
which  such  a  system  may  here  and  there  impose,  not  permanently, 
but  as  the  mere  accident  of  fugitive  events. 

Here,  then,  under  a  system  of  Free  Trade,  is  opened  a  field  on 
which  whole  nations,  all  Europe,  the  entire  foreign  world,  with 
their  systems  of  commercial  policy,  and  all  the  parts  of  those  sys- 
tems, in  which  individual  and  associated  enterprise  operates,  with 
all  the  power  of  their  cheap  labor  and  more  perfect  arts,  descend 
upon  us,  without  let  or  hinderance;  enter  our  jurisdiction  without 
tax  and  without  condition,  freighted  with  their  wares  and  merchan- 
dise ;  avail  themselves  of  all  our  public  works  and  facilities  of  trans- 
portation, created  by  our  labor  and  at  our  cost,  to  penetrate  every 
corner  of  the  land,  entering  every  cabin  in  the  remotest  parts  of  the 
western  wilderness  ;  for  what?  and  to  what  end?  To  sell  to  our 
farmers,  throughout  the  length  and  breadth  of  the  land,  corn,  wheat, 
rye,  barley,  beans,  and  every  species  of  breadstufFs  that  can  be 
named  as  the  product  of  our  soil ;  to  sell  us  beef,  pork,  mutton, 
butter,  cheese,  lard,  chickens,  and  every  species  of  meat  that  we 
produce  ;  to  sell  us  cattle,  horses,  mules,  and  every  beast  of  draught 
and  burden  ;  hay,  oats,  provender,  and  everything  that  constitutes 
the  sustenance  of  these  animals ;  to  sell  our  planters  rice  and  cotton ; 
in  a  word,  to  sell  us,  Americans,  the  products  of  forests,  the  fowls 
of  heaven,  and  the  fish  of  the  sea ;  to  sell  us  everything  that  land 
and  water  produce  by  the  sweat  of  those  who  toil  on  them ;  for,  we 
have  proved  elsewhere,  that  all  these  things  enter  in  disguise  into 
the  products  of  manufacture,  and  that  the  former  compose  the  great- 
est portion  of  the  latter;  of  the  truth  of  which,  no  man  that  reflects, 
can  for  a  moment  doubt.  It  is  a  great  and  comprehensive  fact. 
And  they  not  only  sell,  but  they  force  us  to  buy.  We  can  not 
help  it,  under  a  system  of  Free  Trade.  They  are  here,  in  our 
market,  with  their  wares,  composed  in  the  manner  above  described, 
of  the  very  things  which  we  produce,  in  abundance,  and  with  sur- 
plus ;  but  for  want  of  the  encouragement  of  Protection,  we  can  not 
put  them  in  these  necessar}^  and  convenient  forms.  We  must  have 
hem,  though  the  very  materials  of  which  they  are  made,  perish  on 


ON    THE    RIGHTS    OF   OTHERS.  85 

our  hands  for  want  of  a  market ;  though  our  labor  stands  still ; 
though  our  skill  be  fully  adequate  to  produce  the  same  things  ;  and 
though  we  could  make  them  cheaper  and  better,  under  a  system 
of  Protection. 

Nor  is  this  all.  Under  a  Free-Trade  system,  foreigners  come 
here,  without  tax  or  condition,  to  sell  labor  itself,  and  art  of  every 
kind  :  agricultural  labor,  on  an  immense  scale,  as  seen  above ; 
manufacturing  and  mechanical  labor  of  every  description,  and  all 
the  arts,  useful  and  ornamental. 

And  what  is  the  effect  of  all  this  on  the  labor  and  arts  of  this 
country?  Clearly  our  wants,  and  our  ability  to  consume,  are  lim- 
ited. All  that  we  buy,  in  this  way,  of  foreigners,  which  could  and 
would  be  produced  by  ourselves,  under  a  system  of  Protection,  is 
so  much  abatement  of  the  demand  for  home  labor.  This  is  deter- 
mined with  all  the  accuracy  of  figures  and  mathematical  quantities. 
To  the  same  extent,  it  checks  our  advancement  in  the  arts.  And 
not  the  least  of  the  misfortunes  is,  that,  to  the  same  extent  also,  it 
subtracts  from  our  ability  to  buy.  We  are  not  only  so  much 
poorer,  as  we  should  have  been  richer  by  this  saving ;  but  also  so 
much  poorer  as  the  amount  of  this  unnecessary  expenditure.  Here 
is  the  secret  of  the  foreign  balances  against  us,  which  Free  Trade 
invariably  brings  upon  our  heads,  as  shown  in  another  part  of  this 
work.  Nor  is  it  an  answer  to  say,  that  we  must  buy,  in  order  to 
sell ;  for  we  have  also  proved,  in  another  place,  that  the  country 
always  trades  more  with  foreign  parts  under  a  Protective,  than  un- 
der a  Free-Trade  system. 

We  are  aware  it  is  said,  that  Free  Trade  occupies  the  same  po- 
sition, in  the  great  society  of  nations,  which  is  occupied  by  any  two 
parties,  in  their  commercial  transactions  with  each  other,  as  mem- 
bers of  the  same  society  or  commonwealth  ;  and  that  freedom  in 
the  former  case,  is  the  same  as  freedom  in  the  latter.  This  reply 
is  defective  and  fallacious  on  both  points.  First,  it  assumes,  that 
the  trade  in  both  cases  is  under  a  social  system,  without  a  break 
of  jurisdiction  ;  and  next,  that  a  national  protective  system  does  not 
leave  the  parties,  in  their  commercial  transactions,  equally  free  as 
parties  trading  under  one  compact  society.  We  will  first  speak  to 
this  last  point.  It  is  averred,  that  any  two  parties  disposed  to  make 
commercial  exchanges,  should  be  free  to  make  their  own  terms, 
under  common  regulations  of  society,  and  that  this  freedom  is  es- 
sential to  the  rights  of  the  parties  engaged  in  commercial  exchanges. 
Granted.    And  who  can  show,  that  this  is  not  the  case  under  a  na- 


5* 


86  FREE    TRADE    A    LICENSE    FOR    DEPREDATION. 

tional  protective  system,  regulating  foreign  exchanges?  On  this 
point,  the  cases  are  exactly  parallel.  There  is  no  more  freedom 
in  one  than  in  the  other,  when  the  parties  meet.  Under  known 
regulations,  in  both  cases,  they  make  their  terms,  with  no  inter- 
ference whatever. 

As  to  the  other  assumption,  the  cases  are  by  no  means  parallel, 
as  the  assumption  implies.  The  question  is  not  whether  any  two 
parties,  each  living  under  a  national  jurisdiction,  different  from  that 
of  the  other,  shall,  when  they  come  together  for  commercial  ex- 
changes, freely  make  their  own  terms  —  for  this  they  do  equally 
under  a  Protective  or  Free-Trade  system  —  but  whether  one  of 
them,  occupying  a  more  advantageous  position,  as  to  the  cost  of  the 
article  in  which  he  trades,  shall  be  permitted,  without  tax,  to  enter 
the  jurisdiction  of  the  other  party,  and  trade  with  him,  to  the  disad- 
vantage, perhaps  the  ruin,  o^  a  third  party  in  the  latter  jurisdiction, 
who  is  engaged  in  producing,  or  trying  to  produce,  the  article  thus 
imported,  under  less  advantageous  circumstances  than  the  foreign 
producer,  and  who,  for  that  reason,  must  fall  before  the  foreigner. 
This  is  the  question.  There  can  be  no  want  of  freedom,  in  any 
case,  in  the  commercial  transactions  of  the  parties  so  engaged,  either 
under  a  Free-Trade  or  Protective  system.  But  the  question  is, 
whether  a  party,  under  one  national  jurisdiction,  shall  be  permitted 
in  this  way,  through  a  second  party  under  another  jurisdiction,  to 
invade  and  impair,  to  ruin  it  may  be,  the  interest  of  a  third  party 
under  the  latter  jurisdiction,  and  thus  to  injure  the  neighbors  of  this 
third  party,  and  thus  to  injure  the  community  of  which  he  is  a 
member.  "  U  one  member  suffers,  all  the  members  suffer  with  it." 
And  when  all  the  members  suffer,  not  simply  from  their  connexion 
with  the  others,  but  in  their  own  proper  position,  under  a  common 
misfortune,  the  state  of  the  body  is  bad  indeed.  It  is  the  effect  of 
these  Free-Trade  transactions  on  third  parties,  and  that  alone, 
which  constitutes  the  evil,  the  injustice.  These  third  parties,  which 
sometimes  embody  a  whole  people,  are  thus  deprived  of  their  rights, 
and  their  subsistence  is  impaired  by  foreign  depredators. 

Thus,  the  claims  of  Free  Trade  are  nothing  other,  nor  less,  than 
for  an  open  field  of  depredation,  without  restriction,  on  the  rights 
of  others.  Both  the  principle  on  which  it  is  founded,  and  the  spirit 
which  actuates  it,  are  identical  with  the  principle  of  anarchy,  and 
with  that  spirit  which,  in  the  absence  of  law,  and  from  the  imper- 
fections of  the  social  state,  is  for  ever  seeking  to  take  advantage  of 
the  defenceless,  and  to  injure  them. 


l/i  <^^^w  <% . 


RISE    AND    PROGllESS    OF    FREE    TRADE.         „  S7 "^ 

CHAPTER  V. 

REASONS  OF  THE  RISE  AND  PROGRESS  OF  THE  THEORY  OF 

FREE  TRADE. 

The  Prevalence  of  Free  Trade  makes  a  Problem. — The  Rules  by  which  it  is  to  be  eolved. 
— British  Writers  and  Literature  on  this  Subject. — The  Free-Trade  Epoch. — British 
Legislation  for  Protection,  and  the  Effect  of  this  Policy  for  a  Century  previous  to  Adam 
Smith — Treatment  of  the  American  Colonics  under  the  Crown. — Its  Inconsistency  with 
Free  Trade. — Free  Trade  in  Great  Britain  a  State  Policy,  not  a  General  Principle. — 
Adam  Smith  employed  by  the  British  Government  to  write  his  Book — His  Inconsistency 
and  Self  Contradiction. — Examples — The  chief  Aim  of  Adam  Smith,  was  to  reconcile 
the  American  Colonies  to  Injustice. — Free  Trade  a  British  Instinct  and  Selfish — MCul- 
loch's  Betrayal  of  British  Policy. — The  Authority  of  Britisli  Writers  on  Free  Trade. — 
Their  Authority  in  our  Schools,  and  in  forming  the  Miudsof  our  Statesmen. — Ob.sequious- 
ness  and  Servility  of  American  Free-Trade  Economi.sts. — Free  Trade  a  one-legged 
Science. — Born  in  the  Closet. — Biitish  Free  Trade  Writers  Employees  of  the  British 
Government.^ — History  of  Free  Trade  as  a  Party  Question  in  the  United  States. — Its 
Prevalence  here  owing  to  Social  Position  and  Obsequiousness. — Instincts  of  the  Ameri- 
can People  in  Favor  of  Protection. — Free  Trade  can  not  be  the  permanent  Policy  of  the 
United  States. 

The  theory  of  Free  Trade,  though  it  has  ramifications,  is  com- 
posed of  a  single  dogma,  and  that  a  mere  hypothesis,  which,  as  we 
have  shown,  has  never  yet  advanced  a  single  inch  in  its  own  veri- 
fication, but  which  has  actually  been  driven  from  the  field,  times 
without  number,  by  counter  verifications.     By  a  rule  of  logic  and 
of  scientific  investigation,  that  an  hypothesis  is  not  always  to  remain 
an  hypothesis,  it  has  not  now  the  slightest  claim  to  be  entertained       i    /     (77" 
by  a  single  human  being  ;  for  it  was  originally  nothing  but  an  hy-       '    '   (J/v 
pothesis,  and  is  still  nothing  more.     Nevertheless,  it  has  been  enter-  J^k/f/ul 
tained  for  ages,  by  many  men  of  many  nations,  and  advocated  by  /jX  • 

men  of  distinguished  consideration.  Unless  reasons  can  be  given  L-^*"^^  '' 
why  they  should  have  entertained  an  error,  and  so  gross  an  error  as  ^^*  A^t^ 
this  appears  to  be,  the  fact  of  their  having  entertained  it,  might  seem 
to  be  a  formidable  recommendation,  so  far  as  mere  authority  governs 
mankind.  It  is  the  main  object  of  this  chapter  to  show,  in  the  rise 
and  progress  of  Free  Trade,  why  this  false  pretension  has  been  so 
long  and  so  extensively  received.  We  propose  to  make  it  appear, 
that  in  all  the  cases  and  in  all  the  extent  in  which  the  Free-Trade 
hypothesis  has  been  adopted  or  advocated,  the  secret  of  the  influ- 
ences which  have  led  to  that  result,  will  be  found,  either  in  the  so- 
cial position  or  interest  of  the  parties  ;  or  in  the  pride  of  science ; 


.*  ^"^  ^ 


88  REASONS  OF  THE  RISE  AND  PROGRESS 

S^X)r  in  a'^snbserviehce  to  authority  ^  or 'in  a  propensity  to  extra\^agant 
*       opinions  ;* or  in  ignorance  and  disqualification  to  appreciate  the  sub- 
ject.    In  many  cases,  perhaps  in  the  majority,  two  or  more  of  these 
reasons  have  combined  their  influence. 

We  will  begin  with  the  history  of  this  subject  in  Great  Britain. 
In  the  first  place,  we  would  call  attention  to  British  literature,  and 
to  British  legislation,  on  the  subject  of  the  protective  policy,  during 
the  first  century  or  so  of  the  existence  of  her  protective  system. 
Sir  James  Stewart's  work,  published  in  17G9,  was  the  first,  in 
what  may  be  called  the  epoch  of  Free  Trade,  which  advocated 
that  doctrine.  Previous  to  that  time,  for  a  hundred  years  or  more, 
nearly  all  British  writers  on  public  economy,  such  as  Child  who 
wrote  in  1G70,  Gee  who  wrote  in  1730,  Cantillon  who  wrote  in 
1750,  Mildmay  who  wrote  in  17G0,  and  others  scattered  along  this 
period,  all  advocated  Protection  in  the  strongest  terms,  and  some 
with  great  ability.  We  have  elsewhere  made  extracts  from  Gee, 
and  referred  to  his  confession,  that  he  wrote  "  by  order  of  the  lords 
of  trade."  His  connexion  with  the  government,  is,  in  various  forms, 
recognised  in  his  work.  A  century  of  such  teaching,  and  a  prac- 
tice in  legislation  corresponding  with  this  doctrine,  had  taught  Great 
Britain  the  value  of  a  protective  system.  During  this  time,  from 
six  to  seven  hundred  penal  laws  were  enacted,  to  secure  the  objects 
of  this  policy,  some  of  them  of  great  severity.  One,  for  example, 
against  exporting  a  sheep,  or  a  fleece  of  wool,  imposing  a  forfeiture 
of  goods  for  the  first  ofteuce,  cutting  off  the  hand  and  nailing  it  up 
in  the  town  market  for  the  second,  and  death  for  the  third.  Enti- 
cing away  artisans  and  manufacturers,  was  severely  punished. 
The  export  of  machinery  was  prohibited  by  forfeiture  and  other 
penalties. 

By  a  rigid  adherence  to  this  system,  from  the  time  it  was  first 

•  adopted,  down  to  the  middle  of  the  eighteenth  century,  Great  Brit- 

•  -     ain  was  growing  rich,  and  acquiring  power,  beyond  all  example, 

either  in  her  own  history,  or  in  that  of  other  nations.  Holland  for 
commerce,  and  Flanders  for  manufactures,  were  already  supplanted 
by  her,  she  having  borrowed  her  arts  from  the  latter  country,  and 
outstripped  the  former  in  vending  her  wares  over  the  vi^orld.  She 
could  not  have  failed  to  see  her  own  position  already  gained,  and 
the  rapidity  of  her  march  in  a  career  of  increasing  wealth  and 
power,  nor  could  she  have  been  ignorant  of  the  cause. 

But  she  occupied  a  most  important,  yet  critical  position,  in  rela- 
tion to  her  North  American  colonies,  which  were  clamoring  for 


N 


OF  THE  THEORV  OF  FREE  TRADE.  89 

protection  in  their  rights,  had  already  set  up  manufactures  in  defi- 
ance and  evasion  of  prohibitory  laws,  and  threatened  independence, 
at  least  in  the  supply  of  their  own  wants,  as  far  as  they  could  do 
it.  Whatever  might  be  the  future  political  condition  and  relations 
of  those  colonies,  the  far-seeing  eye  of  a  British  statesman  could 
not  fail  to  discern,  that  the  character  of  British  literature  on  the 
subject  of  public  economy,  which  had  come  to  have  and  was  likely 
to  maintain  a  leading  influence  in  the  world,  could  not  be  changed 
too  soon  ;  and  the  position  of  Great  Britain  at  the  moment,  in  rela- 
tion to  other  nations,  being,  and  still  shooting,  ahead  of  them  all, 
in  her  manufactures  and  commerce,  was  enough  to  give  her  states- 
men the  hint:  "Now  is  the  time  to  withdraw  our  own  lights,  the 
lights  by  which  we  have  so  prospered,  from  the  gaze  of  the  world, 
and  hold  out  new  ones  for  other  nations  to  walk  by  ;  and  it  is  espe- 
cially important  to  convince  our  North  American  colonies,  that  it 
is  their  interest  to  depend  on  us  for  manufactures."  The  same 
argument  w^as  equally  adapted  to  accomplish  their  purpose  with 
foreign  nations,  as  with  the  colonies. 

It  is  admitted,  that  this  is  an  hypothetical  argument,  nor  would 
we  claim  respect  for  it,  any  farther  than  it  is  associated  with  prob- 
abilities based  upon  fact,  the  character  of  which  as  evidence  can 
not  easily  be  resisted  or  denied.  Can  it  be  supposed,  that  British 
statesmen  did  not  see  this  state  of  things  ;  and  if  they  saw  it,  that 
they  would  hesitate  what  to  do  ?  We  arrive,  then,  at  a  moral  cer- 
tainty, that  they  did  see  it,  and  that  they  did  adopt  a  policy  corre- 
sponding thereunto,  viz.,  to  withdraw  their  lights,  to  be  used  behind 
a  screen  for  their  own  purposes,  and  to  hold  out  others  to  the  world, 
after  having  put  them  in  blaze.  And  what  are  the  facts  ?  Sir 
James  Stewart  appeared,  in  1760,  as  a  Free-Trade  writer,  and 
Adam  Smith,  in  1775.  The  former  attracted  much  attention, 
more,  perhaps,  for  the  surprise  and  novelty  of  the  spectacle,  than 
for  ability  of  execution ;  but  it  was  soon  eclipsed  by  Adam 
Smith's  "  Inquiry  into  the  Nature  and  Causes  of  the  Wealth  of 
Nations." 

In  the  first  place,  this  work  of  Adam  Smith  itself  bears  internal 
marks  of  a  special  design  corresponding  with  the  hypothesis  now 
under  consideration.  The  first  edition  must,  as  we  suppose,  have 
gone  to  press,  before  the  war  of  the  American  revolution  com- 
menced. Even  the  revised  editions  show,  in  many  important  parts 
of  the  work,  and  in  all  of  them  havino-  a  bearin":  on  Free  Trade, 
that  the  writer  had  his  eye  on  the  colonies,  which  it  was  then  ex- 


90  REASONS    OF    THE    RISE    AND    PROGRESS 

pected  would  be  reduced  to  obedience,  with  a  view  to  reconcile 
them  to  the  position  of  being  producers  of  raw  produce  for  the 
mother-country,  and  to  a  state  of  dependence  for  articles  of  man- 
ufacture. He  panders,  like  a  demagogue,  to  the  assumed  taste  of 
the  colonies ;  preaches  against  monopolies  and  corporations,  of 
which  they  had  so  loudly  complained  ;  and  in  an  edition  published 
after  the  war  broke  out,  is  to  be  found,  in  the  form  of  inuendo,  the 
following  shameful  proposition  :  "  That,  if  to  each  colony,  which 
should  detach  itself  from  the  general  confederacy,  Great  Britain 
should  allow  a  representation,  a  new  method  of  acquiring  impor- 
tance, a  new  and  more  dazzling  object  of  ambition,  would  be  pre- 
sented to  the  leading  men  of  each  colony,  to  draw  some  of  the 
great  prizes  which  sometimes  come  from  the  wheel  of  the  great 
state  lottery  of  British  politics  !" 

In  another  place  he  says:  "  To  attempt  prematurely,  and  with 
an  insufficient  capital,  to  do  all  the  three,"   agriculture,  manufac- 
tures,  and   commerce,   "  is   certainly   not  the  shortest  way  for  a 
society,  no  more  than  it  would  be  for  an  individual,  to  acquire  a 
sufficient  one.  .  .  The  revenue  of  all  the  inhabitants  of  the  country, 
is  necessarily  in  proportion  to  the  annual  produce  of  their  land  and 
labor.     It  has  been  a  principal  cause  of  the  rapid  progress  of  our 
American  colonies  toward  wealth  and  greatness,  that  almost  their 
whole  capitals  have  hitherto  been  employed  in  agriculture.     They 
have  no  manufactures,  those  household  and  coarse   manufactures 
excepted  which  necessarily  accompany  the  progress  of  agriculture, 
and  which  are  the  work  of  the  women  and  children  in  every  private 
family.      The  greater  part,   both  of  the  exportation  and  coasting 
trade  of  America,  is  carried  on  by  the  capitals  of  merchants  who 
reside  in  Great  Britain.     Even  the  stores  and  warehouses,  from 
which  goods  are  retailed,  in  some  provinces,  particularly  in  Vir- 
ginia and  Maryland,  belong,  many  of  them,  to  merchants  who  reside 
in  the  mother-country,  and  afford  one  of  the  few  instances  of  the 
retail  trade  of  a  society  being  carried  on  by  the  capitals  of  those 
who  are  not  resident  members  of  it.      Were  the  Americans,  either 
by  combination,  or  by  any  other  sort  of  violence,  to  stop  the  im- 
portation of  European  manufactures,  and  by  thus  giving  a  monop- 
oly to  such  of  their  own  countrymen  as  could  manufacture  the 
like  goods,  divert  any  considerable  part  of  their  capital  into  this 
employment,  they  would  retard  instead  of  accelerating  the  farther 
increase  in  the  value  of  their  annual  produce,  and  would  obstruct 
instead  of  promoting  the   progress  of  their  country  towai'd  real 


OF  THE  THEORY  OF  FREE  TRADE.  91 

wealth  and  greatness.  This  would  be  still  more  the  case,  were 
they  to  attempt,  in  the  same  manner,  to  monopolize  to  themselves, 
their  whole  exportation.  .  .  It  is  thus  that  the  same  capital  will,  in 
any  country,  put  into  motion  a  greater  or  smaller  quantity  of  pro- 
ductive labor,  and  add  a  greater  or  smaller  value  to  the  annual 
produce  of  its  land  and  labor,  according  to  the  different  propor- 
tions in  which  it  is  employed,  in  agriculture,  manufactures,  and 
wholesale  trade." 

Not  to  speak  of  the  defects  and  inclusiveness  of  this  reasoning 
on  certain  points,  it  would  be  quite  unnecessary  to  declare  its  aim, 
considering  by  whom,  and  in  what  circumstances,  the  advice  was 
given,  on  the  eve  of  the  outbreak  of  the  American  revolution,  and 
when  the  colonies  were  demanding  the  right  to  set  up  manufac- 
tures, and  to  engage  in  commerce,  and  were  forbidden  both.  Nor 
does  this  reasoning  appear  to  be  very  consistent  with  the  principle 
of  Free  Trade.  The  facts  recognised  are  very  impressive,  in 
view  of  our  colonial  history.  One  is  amazed,  that  such  prohi- 
bitions and  restrictions  could  have  been  endured  so  long;  and  not 
less  amazed,  that  they  should  have  been  advocated  by  Adam 
Smith,  the  father  of  the  Free-Trade  philosophy. 

Notwithstanding  the  laudation  of  agriculture,  above  cited,  for  the 
sake  of  contenting  the  American  colonists  in  their  condition  of 
"hewers  of  wood  and  drawers  of  water"  to  the  parent-country, 
this  same  author,  before  he  had  finished  the  chapter,  could  record, 
without  compunction,  the  following  sentences :  "  The  profits  of 
agriculture  seem  to  have  no  superiority  over  those  of  other  em- 
ployments. .  .  We  see  every  day  the  most  splendid  fortunes  that 
have  been  acquired  in  the  course  of  a  single  life,  by  trade  and 
manufactures,  frequently  from  a  very  small  capital,  sometimes  from 
no  capital.  A  single  instance  of  such  a  fortune  acquired  by  agri- 
culture, in  the  same  time,  and  from  such  a  capital,  has  not  perhaps 
occurred  in  Europe  during  the  course  of  the  present  century." 

It  mattered  not  whether  the  colonies  should  be  reduced  to  obe- 
dience, or  prove  triumphant;  the  same  theory  of  public  economy, 
and  the  same  argument,  would  be  applicable,  for  the  objects  of 
British  policy  ;  and  who  will  not  believe,  under  all  the  circum- 
stances, that  the  theory  of  Free  Trade,  which  is  allowed  to  have 
derived  its  grand  impulse  from  the  hand  of  Adam  Smith,  was 
framed,  and  the  argument  made,  expressly  for  the  case,  under  the 
advice  of  far-seeing  British  statesmanship?  How,  it  may  be 
asked,  on  any  other  hypothesis,  could  it  have  happened,  that  this 


92  REASONS    OF    THE    RISE    AND    PROGRESS 

theory  should  have  been  so  adroitly  put  forward  in  Great  Britain 
three  quarters  of  a  century  ago  ;  how,  otherwise,  could  it  have 
happened  that  the  argument  should  have  been  repeated  and  im- 
proved upon  by  her  greatest  writers,  fiom  that  day  to  the  present, 
calling  upon  all  the  world  to  adopt  it,  and  yet  that  Great  Britain 
herself  should  have  gone  steadily  on  in  her  old  career,  without 
relaxing  her  system  of  Protection  a  single  whit?  For,  we  have 
elsewhere  shown,  that  such  is  the  fact,  not  excepting  even  the 
pretended  approximation  to  Free  Trade,  under  the  administration 
of  Sir  Robert  Peel.  Did  the  world  ever  witness  such  a  spectaoj^ 
of  inconsistency,  if  it  be  supposed  that  this  was  not  a  profoundly 
devised  state  policy,  putting  in  requisition,  and  keeping  in  employ- 
ment, from  age  to  age,  the  greatest  literary  talent  of  the  empire  ? 

From  the  time  of  Joshua  Gee  we  hear  no  more  from  the  mouths 
of  British  writers  on  public  economy,  of  their  going  to  their  tasks 
"  by  order  of  the  lords  of  trade."  This  would  not  do,  after  the 
policy  of  our  hypothesis  was  adopted.  When  it  was  resolved  to 
recommend  Free  Trade  to  the  world,  these  connexions  between 
the  government  and  Free-Trade  writers,  were  kept  out  of  sight,  as 
much  as  possible.  Nevertheless,  there  are  some  facts,  in  the  case 
of  Adam  Smith,  bearing  on  this  point,  worthy  of  note.  The  motive 
proffered,  to  induce  him  to  vacate  his  professor's  chair,  in  the 
university  of  Glasgow,  and  travel  with  the  young  duke  of  Buc- 
cleu2;h  on  the  continent,  was.  as  stated  in  a  note  of  Herron's  Ju- 
nius,  "  upon  conditions  which  assured  the  philosopher  an  ample 
independence  for  his  future  life  ;"  and  the  man  who  made  this  offer, 
was  Charles  Townsend,  of  whom  the  same  authority  says,  "  he  was 
a  man  of  splendid  talents,  of  lax  principles,  and  of  boundless  vanity 
and  presumption.  He  had  belonged  to  every  party,  and  cared  for 
none."  He  had  been  secretary  at  war  under  the  Bute  administra- 
tion, and  left  the  post  with  discredit.  Under  Lord  Chatham  he 
was  chancellor  of  the  exchequer  ;  and  under  the  duke  of  Grafton,  he 
was  one  of  the  boldest  advocates  for  the  taxation  of  America. , 
While  he  was  a  member  of  the  administration,  it  is  remarkable,  that 
the  sinecure  place  of  "  one  of  the  commissioners  of  his  majesty's 
customs  in  Scotland,"  was  conferred  upon  Adam  Smith,  doubtless 
in  part  redemption  of  the  pledge  of  "  an  ample  independence  for 
future  life  ;"  and  this  title  of  "  commissioner,  etc.,"  will  be  seen 
staring  out  on  the  titlepage  of  the  early  editions  of  the  "Wealth  of 
Nations,"  for  gratitude,  or  ostentation,  or  both.  That  Adam  Smith 
was  a  beneficiary  of  the  British  government,  is  evident  enough ;  and 


K   *^ 


OF  THE  THEORY  OF  FREE  TRADE.  93 

whether  he  was  pensioned  to  indite  matter  at  the  bidding  of  mas- 
ters, considering  all  the  circumstances  of  the  case,  may  safely  be 
left  to  the  judgment  of  those  who  look  at  these  facts.  He  did  not 
begin  his  work  till  after  he  was  seduced  from  his  high  dignity  at 
Glasgow,  and  stepped  into  the  sunshine  of  the  British  crown  —  first 
indirectly,  afterward  directly. 

Here,  then,  in  the  case  of  Adam  Smith,  who  occupies  the  post 
of  the  great  aposde  of  Free  Trade,  may  be  seen  enough  of  his 
social  position  and  in  the  interest  secured  to  him,  to  account  for 
all  his  zeal  in  this  cause,  and  for  all  his  inconsistencies  in  making 
an  argument  on  both  sides  of  the  question.  Was  he  not  paid 
for  it? 

And  how  should  it  happen  that  nearly  all  British  writers  on  this 
subject,  from  Adam  Smith  down  to  this  time,  and  nearly  or  quite 
all  the  lecturers  of  the  universities,  and  almost  the  entire  periodical 
press,  quarterlies,  monthlies,  weeklies,  and  dailies  of  Great  Britain, 
should  have  become  one  solid  phalanx  of  Free-Trade  advocates, 
while  the  British  government  has  practised  nothing  but  Protection? 
This,  certainly,  is  a  very  extraordinary  spectacle.  It  is  the  in- 
stinct of  the  British  nation,  and  nothing  else  —  the  instinct  of  self- 
preservation  and  self-interest.  It  is  their  commercial  and  social 
position  in  relation  to  the  rest  of  the  world.  They  know  that 
Free  Trade  practised  everywhere  else,  and  Protection  practised 
only  by  themselves,  are  not  only  essential  to  their  interests,  but 
that  it  will  bring  the  whole  world,  all  nations,  at  their  feet. 

If  it  were  possible  to  doubt  this  great  conspiracy  against  man-      yv. 
kind,  from  Adam  Smith  down  to  INI'Culloch,  the  followinfr  extract 
from  M'Culloch's  own  pen,  in  his  Dictionary,  proving  at  the  same 
time  his  fidelity  to  his  patrons,  the  British  government,  and  his  trea- 
son to  all  other  nations,  will   be  sufficient  to  setde  the  question  : — 

"  Our  establishments  for  spinning,  weaving,  printing,  bleaching, 
&c.,  are  infinitely  more  complete  and  perfect  than  any  that  exist 
^elsewhere ;  the  division  of  labor  in  them  is  carried  to  an  incom- 
parably greater  extent ;  the  workmen  are  trained  from  infancy  to 
industrious  habits,  and  have  attained  that  peculiar  dexterity  and 
sleight  of  hand  in  the  performance  of  their  several  tasks,  that  can 
only  be  attained  by  long  and  unremitted  application  to  the  same 
employment.  Why,  then,  having  all  these  advantages  on  our  side, 
should  we  not  keep  the  start  we  have  gained  ?  Every  other  peo- 
ple that  attempt  to  set  up  manufactures  must  obviously  labor  under 
the   greatest  difficulties,  as  compared  with  us.     Their  establish-  » 


*  >  >*  *   *  ■^. 


94  REASONS    OF    THE    RISE    AND    PROGRESS 

ments  can  not,  at  first,  be  sufficiently  large  to  enable  the  div^ision 
of  employments  to  be  carried  to  any  considerable  extent;  at  the 
same  time  that  expertness  in  manipulation,  and  in  the  details  of  the 
various  processes,  can  only  be  attained  by  slow  degrees.  It  ap- 
pears, therefore,  reasonable  to  conclude,  that  such  new  beginners, 
having  to  withstand  the  competition  of  those  who  have  already 
arrived  at  a  very  high  degree  of  perfection  in  the  art,  must  be  im- 
mediately driven  out  of  every  market  equally  accessible  to  both 
parties  ;  and  that  nothing  hut.  the  aid  derived  from  restrictive  regu- 
lations and  irrohibitions,  will  be  effectual  to  prevent  the  total  de- 
struction of  their  establishments,^''  &c. 

The  passage  in  italics  tells  the  story,  and  discloses  the  doom 
assigned  to  us,  and  to  all  nations,  which  adopt  the  Free  Trade 
commended  to  them  by  ihe  iiensioned  economists  of  Great  Britain. 
And  this  the  man,  now  extant,  and  rightful  successor  of  the  same 
class,  in  the  line  from  Adam  Smith,  who,  from  his  pulpit  in  Lon- 
don, preaches  Free  Trade  to  all  the  world,  as  the  gospel  of  the 
Gentiles,  but  designed  only  to  save  the  Jews.  He  testifies  to  his 
brethren,  sub  rosa,  as  above,  that  it  will  save  no  others,  and  that  all 
nations,  except  the  British  empire,  will  be  lost  by  it. 

The  motive  of  the  British  government,  for  such  a  systematic  and 
stupendous  fraud,  as  is  here  supposed,  was  a  potent  one  :  It  was 
to  become  the  richest  nation  in  the  world  —  in  that  way,  the  most 
powerful  —  and  to  maintain  that  ascendency. 

It  may  be  true,  that  the  argument  of  this  chapter  impeaches  the 
discernment  of  some  portion  of  the  American  mind,  of  which  one 
could  wish  to  think  better.  That  so  many  learned  doctors  and 
statesmen  could  have  fallen  so  easily  into  this  snare,  may,  at  first 
sight,  seem  strange.  But  a  moment's  reflection  will  show,  that  it 
is  not  at  all  strantre.  The  stratajrem  would  never  have  succeeded, 
if  it  had  not  been  planned  to  catch  them.  Public  economy,  as  all 
must  feel,  who  shall  have  attentively  followed  us  through  this  vol- 
ume, is  one  of  the  profoundest  subjects,  of  an  earthly  origin,  that^ 
ever  engaged  the  human  mind.  It  is  but  recently,  compared  with 
the  history  of  most  of  the  sciences,  that  it  has  set  up  a  claim  to  be 
one  of  them.  It  can  scarcely  be  said,  indeed,  that  this  claim  was 
urgently  insisted  upon,  till  the  hatching  of  the  British  state  policy 
which  is  alleged  above.  It  was  meet,  for  the  purpose  in  view,  that 
it  should  assume  this  elevated  and  commanding  position,  to  excite 
deference  and  respect,  as  a  mere  pretension.  Such  claims  as  these 
are  not  usually  scrutinized  at  once,  when  they  make  a  descent  upon 


*.  ^  «■ 


OF  THE  THEORY  OF  FREE  TRADE.  95 

the  human  mind  in  such  an  imposing  shape  —  especially  if  they 
come  from  respectable  authority.  It  is  natural  to  receive  them  in 
faith  for  a  season,  when  they  are  accompanied  with  the  sanction  of 
great  names.  It  is  the  habit  of  the  American  mind  —  too  much 
so,  perhaps  —  to  defer  to  European,  especially  to  British,  authority, 
in  matters  of  science.  Is  it  strange,  tlien,  that  this  pretension,  so 
cunningly  devised,  and  backed  with  names  of  such  repute,  should 
have  been  transiently  entertained  among  us,  by  the  mere  force  of 
authority?  Certainly  it  is  much  more  reasonable  to  suppose  this, 
than  now,  in  all  the  light  on  this  subject,  to  retain  this  species  of 
faith. 

A  word  is  due  to  the  influence  of  the  pride  of  science  on  this 
subject.  We  have  already  given  reasons  to  show  why  public  econ- 
omy, hitherto,  has  had  no  claim  to  be  dignified  with  the  name  of  a 
science,  and  particularly  that  the  Free-Trade  hypothesis  can  not 
possibly  be  a  science,  first,  because  it  is  a  mere  hypothesis  still ; 
next,  because  all  its  propositions  are  empirical  laws  ;  and  thirdly, 
because  they  fall  under  that  category  of  empirical  laws  which  for 
ever  precludes  them  from  being  reduced  to  a  science.  But, 
in  every  department  of  inventive  research,  will  be  found  men 
of  intellectual  obliquity,  and  of  loud  pretensions,  who  some- 
times get  a  theory  in  their  heads,  which  they  baptize  with  the 
name  of  a  science,  as  in  the  case  of  Free  Trade,  then  mount  the 
hobby,  and  drive  it  with  furious  intent.  True  science,  though 
always  modest,  is  undoubtedly  a  thing  of  very  just  pride.  As 
public  economy  has  been  installed  ampng  the  sciences  by  British 
economists,  the  more  extravagant  the  pretension,  as  to  form  and 
substance,  so  much  the  more  captivating  is  its  influence  over  that 
class  of  persons  to  which  we  have  alluded  above.  Sobriety  would 
as  little  suit  their  taste,  as  the  labors  of  a  genuine  science  would 
suit  their  habits.  They  want  something  that  will  strike  the  fancy, 
something  that  will  prove  itself;  they  want  the  philosopher's  stone 
that  will  turn  everything  into  gold  ;  and  this  they  find  in  Free 
Trade.  It  is  a  beautiful  theory  to  such  minds  ;  what  could  be 
more  charming?  Besides,  it  costs  nothing  in  the  way  of  verifica- 
tion ;  for  it  has  but  one  proposition.  It  is  a  science  that  stands  on 
one  leg.  It  never  budged  an  inch,  and  never  can,  as  such.  Never- 
theless, it  is  very  captivating  to  those  who  think  it  is  a  science,  and 
they  dance  around  it,  chanting  their  hymns  of  satisfaction,  and  do- 
ing homage  as  to  a  symbol  of  mystic  import.  Did  ye  never  witness 
the  exceeding  delight,  the  ecstacy  of  these  savans,  and  with  what 


96  REASONS    OF    THE    RISE    AND    PROGRESS 

airs  of  tnuini)li  they  put  to  you  their  one-legged  concern?  They 
evidently  think  it  a  perfect  beauty  ;  it  is  a  science,  they  say.  Born 
in  the  closet,  these  notions  have  been  transferred  from  one  closet 
to  another,  and  re-elaborated  there,  by  the  brains  of  every  succeed- 
ing theorist,  with  all  the  fervor  and  satisfaction  of  scholastic  pride, 
without  the  slightest  knowledge  of  the  practical  operation  of  these 
principles  in  the  common  affairs  of  life.  Like  greenhouse  plants, 
which  perish  before  the  rude  action  of  the  changing  seasons,  when 
exposed,  so  these  Free-Trade  principles,  applied  to  the  practical 
concerns  of  the  commercial  world,  bring  forth  nothing  but  unripe 
or  blasted  fruit. 

Men  are  sometimes  found  in  eminent  positions,  even  in  connex- 
ion with  our  colleges  and  universities,  who  are  compelled  to  borrow 
the  caj^ital  of  ideas  in  which  they  trade,  in  the  way  of  teaching  and 
writing.  This  capital,  so  Air  as  this  subject  is  concerned,  as  before 
shown,  is  furnished  to  their  hands,  in  the  greatest  abundance,  by 
British  authorities.  We  have  seen  how  it  began  to  be  formed, 
nearly  a  century  ago,  under  the  auspices  of  Adam  Smith  ;  what 
state  reasons  existed  for  laying  this  foundation  ;  how  it  has  been 
carefully  husbanded,  from  that  time  to  this,  as  a  British  state  poli- 
cy ;  how  the  greatest  talent  of  the  British  empire  has  been  seduced 
into  this  service,  and  kept  industriously  employed  ;  and  how  this 
feeling  —  a  mere  feeling  —  has  become  an  instinct  of  the  British 
nation,  that  Free  Trade  in  all  the  world  is  necessary  to  their  pre- 
eminence. Nor  do  they  preach  this  doctrine  insincerely,  though  as 
yet  they  have  never  practised  it ;  but  they  are  prepared  for  it,  as 
shown  in  the  extract  from  Mr.  M'Culloch  above,  and  as  we  have 
shown  in  a  subsequent  chapter,  as  soon  as  a  general  consent  can 
be  obtained.  They  have  gained  a  position  which  enables  them  to 
afford  it,  and  which  will  insure  their  advantage,  their  ascendency, 
over  all  other  nations,  on  a  Free  Trade  platform.  This  vantage- 
ground  has  been  the  constant  aim  of  British  statesmen  for  seventy- 
five  years.  Their  writers,  and  their  press  in  all  its  forms,  during 
this  period,  have  made  the  best  argument  that  could  be  made  ;  and 
their  example  has  seduced  many  continental  waiters,  and  some  por- 
tions of  the  continental  periodical  press,  into  their  footsteps.  There 
is  no  nation,  whose  authority  in  learning  and  science,  is  more  com- 
manding than  that  of  Great  Britain  —  none,  certainly,  more  impo- 
sing in  relation  to  us,  who  are  of  the  same  family,  and  who  speak 
the  same  language.  When  we  borrow  ideas  from  any  quarter,  we 
more  naturally  borrow  from  that.     All  the  most  eminent  British 


OF  THE  THEORY  OF  FREE  TRADE.  97 

authorities  on  public  economy,  are  no  sooner  out  of  the  press  in 
London,  than  they  appear  here.  Thence  our  economists,  for 
the  most  part,  borrow  their  capital  on  this  subject ;  and  our  schools 
and  colleges  are  greatly  influenced  and  swayed  by  these  two  com- 
bined agencies,  foreign  and  domestic.  Here  is  to  be  observed  the 
action  of  the  simple,  but  potent  principle  of  subservience  to  author- 
ity, laid  down  as  one  of  the  rules  at  the  beginning  of  this  chapter, 
to  determine  the  reasons  of  the  rise  and  progress  of  Free  Trade. 
Ignorant  of  that  great  state  policy  which  brought  these  works  into 
existence  in  Great  Britain,  Americans  become  its  victims,  where 
they  think  they  are  getting  a  science  all  made  at  their  hands.  We 
will  not  say  the  subserviency,  but  the  servility  with  which  these 
notions  of  Free  Trade  have  been  copied  in  this  country  from  Brit- 
ish authorities,  by  Americans  occupying  eminent  places  in  our 
seminaries  of  learning,  and  who  have  propagated  them  to  the  ex- 
tent of  their  abilities  and  influence,  is  not  simply  a  subject  of  regret 
for  the  evil  which  it  does  to  the  country,  but  of  humiliation  at  the 
sight  of  such  obsequiousness. 

From  this  higher  department  of  the  American  mind,  as  it  has 
been  brought  into  action  on  this  subject,  we  are  forced  to  descend 
for  a  moment,  though  with  regret,  into  the  arena  of  party  politics, 
to  see,  if  the  prevalence  of  Free-Trade  principles  in  that  quarter, 
can  be  accounted  for  by  one  or  more  of  the  rules  laid  down  at  the 
beginning  of  this  chapter.  We  believe,  that  the  instincts  of  the 
American  people,  left  to  themselves,  are  necessarily  on  the  side  of 
Protection,  and  that  nothing  but  some  special  and  unnatural  cause, 
some  violent  shock,  could  have  carried  them  over,  even  for  a  tran- 
sient period,  to  the  other  side.  The  entire  mass  of  the  free  labor 
of  this  country  feels,  and  has  ever  felt,  that  it  can  not  and  will  not 
be  placed  side  by  side  with  the  pauper  labor  of  Europe,  to  be  fed 
and  clothed  as  that  is  fed  and  clothed,  to  be  housed  as  that  is 
housed,  and  starved  as  that  is  often  starved.  Yet  Free  Trade  pro- 
poses this  —  we  say,  proposes  it  —  because,  if  figures  do  not  lie,  it 
must  necessarily  lead  to  that  result.  How,  then,  has  it  happened, 
that  a  great  and  for  a  long  time  dominant  party  of  this  country 
should  have  adopted,  and  put  into  operation,  by  their  chiefs  and 
leaders,  the  doctrines  of  Free  Trade  as  a  public  policy  ?  We 
propose  to  answer  this  question,  under  the  guidance  of  the  rules 
we  have  laid  down. 

A  mere  accident  in  our  political  history,  but  a  very  comprehen- 
sive and  momentous  one,  has  contributed  more,  perhaps,  than  any 

7 


98  REASONS    OF    THE    RISE    AND    PROGRESS 

or  all  things  else,  to  propagate  among  the  people  of  this  country, 
for  a  season,  the  influences  of  the  Free-Trade  theory.  We  mean 
the  accidental  position  of  the  chief  magistrate  of  the  United  States, 
arising,  in  1831,  out  of  a  personal  feud  between  him  and  the  vice- 
president.  The  president,  in  vindicating  the,  executive  authority, 
in  the  critical  emergency  of  the  country  that  followed,  went  so  far 
as  to  render  it  convenient  to  himself,  as  a  candidate  for  re-election, 
to  appear  afterward  to  recede  somewhat,  till  he  was  supposed,  ap- 
parently with  justice,  to  have  taken  ground  for  Free  Trade  ;  and 
his  unbounded  popularity  carried  his  party  with  him  in  that  direc- 
tion. For  the  first  time,  in  the  history  of  the  country  —  it  may  be 
hoped  for  the  last  —  this  great  American  question,  which  ought 
for  ever  to  unite  all  Americans,  became,  most  unnaturally,  a  party 
question,  and  has  been  maintained  as  such,  from  that  time  to  this, 
though  with  a  manifest  decreasing  zeal  for  the  Free-Trade  cause 
among  the  people.  To  prove  that  this  revolution  in  popular  opin- 
ion was  caused,  first,  by  the  social  position  of  the  president,  and 
next  by  his  authority  over  the  party,  it  is  only  necessary  to  observe, 
that,  down  to  that  time,  both  he  and  they  were  among  the  soundest 
and  strongest  protectionists  which  the  country  has  ever  had  in  its 
bosom.  The  causes  of  the  change,  therefore,  were  undoubtedly 
purely  moral,  being  a  change  of  social  position  with  the  president, 
and  subservience  to  his  authority  in  his  party.  It  is  altogether 
unnatural,  that  any  portion  of  the  people  of  the  United  States 
should  be  the  advocates  of  Free  Trade,  as  all  their  instincts  must 
necessarily  be  against  it,  when  the  subject  is  understood  by  them. 
It  is  not  only  the  great  question  of  the  age,  but  it  is  emphatically 
an  American  question.  It  is  the  position  and  interests  of  the  Uni- 
ted States  which  have  made  it  the  question  of  the  age,  more  than 
all  other  causes.  European,  especially  British  statesmen,  know 
well,  and  have  long  foreseen,  that,  if  freedom  is  not  suppressed 
here,  it  will  grow  up  there,  and  that  freedom  consists,  as  we  have 
maintained  in  a  subsequent  chapter,  in  the  great  strife  of  the  world 
for  the  rights  of  labor,  for  commercial  rights,  for  the  enjoyment  and 
independent  control  of  commercial  values  by  those  who  create 
them.  The  great  aim  of  British  statesmen  is  to  bring  American 
labor  down  to  the  same  level  with  European,  which  can  only  be 
accomplished  by  a  system  of  Free  Trade. 

But  this  accidental  and  relative  position  of  the  two  great  political 
parties  in  the  United  States,  on  this  question,  induced  as  above 
stated,  and  which  can  hardly,  in  the  nature  of  thirjgs,  endure  long, 


* 


OF    THE    THEORY    OF    FREE    TRADE.  99 

has  forced  the  people  to  act  upon  it,  in  the  great  pohtical  contests 
of  the  country,  before  they  understood  it.  It  is  a  question,  in  the 
consideration  of  which,  if  the  people  generally  are  forced  to  go 
farther  than  its  simplest  forms,  where  their  instincts  will  decide  for 
them,  and  decide  most  safely,  infallibly,  their  minds  will  be  embar- 
rassed,'and  they  will  be  compelled  to  rely  on  one  of  two  modes  of 
decision  :  —  either  to  trust  to  their  party  leaders,  or  to  wait  till  ex- 
periment shall  prove  in  which  of  the  two  courses  of  public  policy 
their  true  interests  lie.  This  is  precisely  the  position,  unfortu- 
nately, in  which  the  people  of  the  United  States  have  been  placed, 
by  making  this  question  a  party  one.  Neither  the  people,  nor 
their  party  leaders,  as  a  body,  have  understood  the  subject.  That 
was  impossible.  And  nothing  of  the  merits  of  the  question  was 
ever  decided,  in  the  result  of  popular  elections,  so  far  as  it  was  in- 
influenced  by  it,  except  as  the  people  were  instructed  by  experi- 
ence, as  for  example  in  1840.  All  other  influences  have  been 
those  of  authority  only. 

Without  having  the  remotest  idea  of  the  real  character  of  Free 
Trade,  in  its  practical  operations,  the  people,  very  extensively,  have 
been  made  to  believe,  that  it  means  to  buy  where  you  can  the 
cheapest,  and  sell  where  you  can  the  dearest,  which  is  very  natur- 
ally thought  to  be  right;  and  that  protection  is  a  tax,  which  every 
one  naturally  objects  to.  In  this  view  of  the  subject,  which  we 
have  elsewhere  proved  to  be  incorrect,  it  is  not  strange  that  dema- 
gogues, and  a  party  press  devoted  to  Free  Trade,  under  the  aus- 
pices of  one  of  the  most  popular  chieftains  that  ever  swayed  the 
sceptre  of  chief  magistracy  in  the  United  States,  should  have  led 
off"  a  majority  of  the  people,  for  a  season,  to  believe  in  this  doctrine, 
till  convinced  of  their  error  by  sad  experience  ;  nor  is  it  strange, 
that  the  same  mode  of  reasoning  should  still  continue  to  have  its 
influence,  so  long,  unfortunately,  as  this  is  made  a  party  question. 
But,  as  it  is,  in  fact  and  properly,  an  American  question,  in  relation 
to  the  foreign  world,  and  has  unnaturally  been  forced  into  the  posi- 
tion of  a  domestic  controversy,  it  can  not  always  be  held  there. 
Sooner  or  later,  the  people  are  doomed  to  learn  by  experience, 
that  the  protection  of  American  labor  and  arts,  against  foreign  labor 
and  arts,  is  indispensably  necessary  to  their  true  interests. 


100   GREAT  BRITAIN  ALONE  PREPARED  FOR  FREE  TRADE 


CHAPTER    VI. 

GREAT  BRITAIN  THE  ONLY  NATION  THAT  IS  PREPARED  FOR  FREE 
TRADE,  AND  THE  UNITED  STATES  THE  LAST  THAT  CAN  AF- 
FORD IT. 

The  Importance  of  Position,  in  all  Competition,  illustrated  by  familiar  Examples. — Adam 
Smitli's  Illustration. — The  Tribe  or  Nation  that  is  ahead  in  Manufactures,  can  keep  ahead, 
by  Free  Trade. — The  first  Lessons  on  Protection  to  Great  Britain. — The  Way  of  her 
Beginning,  and  its  Results. — It  was  by  this  System  that  she  was  able  to  triumph  over 
Napoleon. — Great  Britain  was  Poor  when  she  began  her  Protective  System. — Behold 
the  Consequences. — Great  Britain  always  consults  the  Parties  interested  in  Protection, 
and  complies  with  their  Wishes. — Not  so  the  United  States. — A  remarkable  Example  of 
turning  Witnesses  out  of  Court. — Briti.sh  Manufacturers,  from  the  Strength  of  their  Posi- 
tion, have  consented  to  dispense  with  Protection. — M'Gregoi-'s  Evidence  and  Advice  to 
the  Biitish  Government. — M  Culloch's  Confession. — Action  of  the  States  of  Europe,  after 
the  Overthrow  of  Napoleon,  in  Favor  of  Free  Trade.- — Their  Repentance. — Repent- 
ance of  Russia. — Manifesto  of  Count  Nesselrode. — The  Zoll  Verein  Treaty. — Napoleon's 
Policy. — The  Policy  of  the  European  Continental  Nations  against  Great  Britain,  defen- 
sive -—The  greater  Cost  of  Money  and  Labor  in  the  United  States  an  insuperable  Bar 
to  Free  Trade. — The  Weak,  not  the  Strong,  require  Protection. — British  Free  Trade, 
not  Free  Trade. — British  Differential  Duties  retained. — Effect  of  Commercial  Treaties. 
—The  Whole  Truth  in  few  Words. 

As  great  things  are  illustrated  by  small,  aad  things  remote  by 
those  which  are  near  and  more  familiar,  we  shall  probably  approach 
the  main  points  of  the  subject  of  this  chapter,  with  more  advantage, 
and  in  clearer  light,  through  examples  with  which  most  persons 
are  familiar,  and  which  all  will  be  able  to  appreciate. 

A  man  who  has  acquired  a  standing  in  any  trade  or  commercial 
business,  has  an  advantage  over  one  who  is  just  setting  up.  Who 
does  not  see  that?  An  apprentice,  who  has  worked  but  a  little 
while  at  his  craft,  can  not  do  so  well  as  an  accomplished  journey- 
man. One  mechanic  is  often  preferred  to  another,  because  he  is 
more  skilful,  and  turns  off  better  work  ;  and  one  of  two,  equally 
skilful,  will  outdo  the  other,  and  get  more  custom,  because  he  has 
more  capital,  and  can  make  more  display,  and  more  noise,  to  at- 
tract attention.  Fositiori,  in  every  trade  and  business,  relative  to 
others  in  the  same  pursuit,  is  much  —  is  often  everything  for  rela- 
tive advantage,  in  the  way  of  competition  ;  and  skill  and  capital 
are  always  of  great  account.  By  time,  application,  skill,  capital, 
and  iws'ition,  one  is  constantly  taking  lead  of  another,  in  a  kindred, 
or  in  the  same  pursuit.    Who  does  not  know  the  position  of  Stew- 


M* 


UNITED  STATES  LEAST  PREPARED  OF  ALL  NATIONS..     101 

art,  in  New  York,  as  an  importer,  jobber,  and  retailer  of  fancy  fC^^ 
and  other  dry  goods?  It  has  taken  him  a  long  time  to  acquire  ^T'T^^ 
that  position.  He  has  worked  for  it,  taken  great  pains,  acquired  ^t^^C* 
great  skill  and  taste,  and  from  a  small  beginning,  has  grown  rich  ;  C  ^A 
has  erected  a  magnificent  marble  edifice,  with  sumptuous  fittings  ;  *y  , 
employs  a  hundred  clerks;  has  reduced  everything  to  system,  to  y"^*'^^ 
go  like  a  clock ;  and  he  is  able,  by  all  his  experience,  with  his  f''€i04^ 
capital,  and  by  blending  importing  with  jobbing  and  retailing,  to  M/t/t't 
sell  a  litde  cheaper,  and  a  little  better.  So,  at  least,  it  is  believed  ;  ^^  J 
and  that  is  enough.  His  i)os\Uon  is  without  a  rival.  Nobody  can  ^*4r%' 
compete  with  him. 

Stewart,  among  the  New  York  merchants  of  the  same  class,  is 
like  Great  Britain  among  nations.  He  necessarily  keeps  in  check 
others,  who,  but  for  him,  would  rise.  It  is  admitted  that  it  is  hard 
for  others,  in  the  same  line  of  business,  to  stand  up  against  him, 
and  that  they  suffer  great  disadvantage  from  the  superiority  of  his 
'position. 

It  is  singular,  though  characteristic,  that  Adam  Smith,  in  arguing 
against  a  protective  system  —  he  is  at  one  time  on  one  side,  and  at 
another  on  the  other  side  —  should  have  advanced  the  very  princi- 
ple we  are  now  endeavoring  to  elucidate  as  constituting  the  neces- 
sity of  such  a  system.  He  says  :  "  A  rich  man,  who  is  himself  a 
manufacturer,  is  a  very  dangerous  neighbor  to  all  those  who  deal 
in  the  same  way."  We  not  only  grant  Adam  Smith  his  principle, 
here  laid  down,  but  we  claim  and  appropriate  it.  Great  Britain 
occupies,  in  relation  to  her  neighbors,  to  all  other  nations,  precisely 
the  position  of  Adam  Smith's  "  rich  manufacturer."  She  "  is  a 
very  dangerous  neighbor  to  all  those  who  deal  in  the  same  way." 

It  is  never  true,  that  the  strong  want  protection  against  the  weak  ; 
but  it  is  always  true,  that  the  weak  want  protection  against  the 
strong,  whoever  may  be  the  parties,  or  whatever  the  particulars  in 
which  one  is  strong  and  the  other  weak.  In  the  present  case,  the 
parties  are  nations,  and  the  subject  of  comparison  is  the  state  of 
their  manufactures.  That  nation  which  is  most  advanced,  and  oc- 
cupies the  strongest  position,  in  this  respect,  has  the  advantage  over 
all  others,  and  will  certainly  beat  them,  unless  they  protect  them- 
selves, in  proportion  as  they  are  behind  and  weaker.  This  is  the 
case  from  the  first  remove  from  a  state  of  barbarism,  to  the  highest 
attainments  of  civilization.  The  tribe  that  starts  first  in  any  manu- 
facturing art,  will  have  the  advantage  over  the  neighboring  tribes 
which  have  done  nothing  in  this  way,  and  will  desire  that  the  latter 


102     .GREAT  BRITAIN  ALONE  PREPARED  FOR  FREE  TRADE  : 

r^-v     should  remain  where  they  are  as  producers  of  the  raw  materials.  ^^ 

-    The  manufacturing  tribe  will  be  in  favor  of  Free  Trade,  because,  ' 

^^  '^i  in  that  way,  it  can  make  the  other  tribes  dependent  for  those  fine 

p.      JJi  things,  which  will  be  wanted  as  soon  as  they  are  seen,  but  which 

*^*  can  not  be  produced  at  home,  because  they  do  not  know  how  to 

••    <■   do  it.     They  must,  therefore,  work,  and  pay  with  much  labor  for 

^  V*;  "^^  that  which  costs  the  manufacturing  tribe  but  little  ;  nor  can   the 

'»^  ;V  other  tribes  ever  come  into  competition,  under  a  system  of  Free 

"■^^  Trade.     They  will  require  a  protective  system,  not  only  to  start, 

•  *  *     but  as  long  as  they  are  behind  their  more  skilful  neighbor.      Supe- 

►*  ^    •  rior  skill,  in  this  particular,  is  superior  strength,  which  nothing  can 

balance  but  the  protection  of  the  weaker  party. 

Great  Britain  began  a  new  career,  some  two  hundred  years  ago, 
or  more,  then  a  poor  nation  —  at  least  not  rich  —  with  her  protec- 
tive system,  under  the  teachings  of  Sir  Josiah  Child,  Joshua  Gee, 
*  and  others  of  their  school.  She  found,  as  these  men  taught  her,  that 
for  want  of  a  protective  system,  other  nations  were  drawing  away 
her  cash.  The  doctrine  on  which  she  then  began  to  act,  will  be 
understood  by  the  two  propositions,  on  which  Joshua  Gee,  who 
wrote,  as  he  said,  "  by  order  of  the  lords  of  trade,"  founded  his 
work.  They  are  as  follows  :  "  1.  That  the  surest  way  for  a  nation 
to  increase  in  riches,  is  to  prevent  the  importation  of  such  foreign 
commodities  as  may  be  raised  at  home.  2.  That  this  kingdom  is 
capable  of  raising  within  itself,  and  its  colonies,  materials  for  em- 
ploying all  our  poor  in  those  manufactories,  which  we  now  import 
from  such  of  our  neighbors  as  refuse  the  admission  of  ours."  This 
author  gave  an  account  of  the  trade  of  Great  Britain  with  all  parts 
of  the  world,  and  showed  where  protection  was  demanded,  and 
should  be  applied,  to  check  unfavorable,  and  bring  favorable  bal- 
ances. The  protective  system  of  Great  Britain,  appears  to  have 
been  begun  in  earnest  about  this  time,  not  far  from  the  middle  of 
the  first  half  of  the  seventeenth  century.  Previous  to  that  time, 
some  of  the  continental  nations  were  much  ahead  of  her  in  man- 
ufactures ;  such  as  France,  some  parts  of  Italy,  and  particularly 
Flanders,  directly  opposite,  on  the  other  side  of  the  channel  —  all 
which  drained  her  of  cash,  to  a  most  inconvenient  extent.  One  of 
the  first  steps  of  reform  was  to  import  sheep  from  Flanders,  and  to 
persuade  Flemish  manufacturers  to  come  along  with  them  ;  after 
which,  when  wool  was  grown  at  home,  and  manufactures  of  wool- 
len were  set  up,  under  protective  laws,  severe  penalties  were  enacted 
against  the  export  of  sheep  or  wool,  for  the  second  offence  cutting 


UNITED  STATES  LEAST  PREPARED  OF  ALL  >:ATT0NS.   103 

off  the  hand,  and  for  the  third  death,  which  are  still  on  the  statute- 
book,  though  not  in  force.  Joshua  Gee's  doctrine  was  no  sooner 
reduced  to  practice,  than  its  charm  and  power  were  profoundly  and 
comprehensively  felt,  in  the  increase  of  private  and  public  wealth. 
The  protective  policy  then  began  to  be  applied  in  all  directions, 
and  soon  grew  up  into  a  system,  till  Great  Britain  finally  became, 
in  the  eighteenth  century,  a  great  manufacturing  nation.  She  had 
emerged,  by  the  influence  of  this  system,  from  a  state  of  depend- 
ence on  other  nations,  to  independence,  and  in  turn,  began  to  make 
other  nations  tributary  to  her,  as  she  had  been  to  them.  It  was  the 
vitality  and  power  of  this  system,  which  sustained  her  under  all  the 
burdens  of  Her  expensive  wars,  in  the  eighteenth  century,  still  rising, 
and  still  expanding  her  strength  and  power  by  the  same  cause. 
Her  power  was  in  her  arts,  and  by  her  machinery  one  man  did 
the  work  of  two  hundred,  so  that  a  nation  of  twenty-five  millions 
of  people,  was  equal  to  one  of  hundreds  of  millions.  It  was  by 
her  protective  system,  that  she  was  enabled  to  sustain  herself 
and  her  continental  allies,  for  so  many  years,  and  with  such  un- 
shaken firmness,  against  the  gigantic  power  of  Napoleon  ;  and  it 
was  by  this  that  she  finally  triumphed. 

It  need  not  be  said,  that  Great  Britain  is  now  the  richest  and 
most  powerful  nation  in  the  world,  and  she  probably  commands 
more  active  capital  than  all  the  rest  of  Europe.  No  matter  for  her  \  ) 
national  debt,  as  it  is  all  owned  by  her  own  subjects.  She  is  none  ^  , 
the  poorer  for  that;  but  the  fact,  that  her  credit  has  never  failed, 
and  still  continues  firm,  under  the  burden,  makes  of  it  an  additional 
evidence  of  her  immense  and  untold  wealth.  She  commenced  her 
protective  system,  in  the  seventeendi  century,  if  not  a  second  rate 
nation,  as  to  wealth  and  commercial  greatness,  at  most  on  a  par 
with  many  other  nations.  In  less  than  a  century,  she  began  to 
display  her  superior  strength  ;  and  in  one  hundred  and  fifty  years, 
her  commercial  credit  was  a  match  for  the  whole  world.  During 
all  this  time,  her  protective  policy  was  never  relaxed,  but  was 
steadily  improved  and  extended,  till  it  embraced  every  commercial 
interest  of  her  subjects,  in  relation  to  foreign  parts.  Her  board  of 
trade  has  always  been  the  medium  of  communication  between  the 
interests  of  her  people  and  public  legislation  regarding  those  in- 
terests ;  and  no  manufacturing  art  or  enterprise  ever  asked  protec- 
tion at  her  hands,  without  receiving  it ;  nor  was  protection  ever 
taken  away  from  any,  without  the  consent  of  those  engaged  in  it, 
the  case  of  the  corn  laws  excepted.     She  has  ever  been  wise 


104   GREAT  BRITAIN  ALONE  PREPARED  FOR  FREE  TRADE  : 

enough  to  consult,  through  her  board  of  trade,  the  wishes  of  the 
parties  concerned,  as  being  the  best  and  most  competent  judges  of 
the  amount  of  protection  wanted,  or  whether  any  was  wanted  —  a 
remarkable  contrast  to  a  fact  that  occurred  in  the  history  of  the 
twenty-seventh  congress  of  the  United  States,  when,  on  motion  of 
the  Hon,  J.  P.  Kennedy,  that  a  committee  be  appointed  to  take 
evidence  for  the  adjustment  of  the  subjects  and  rates  of  duty  in  the 
tariff  of  1S42,  a  member  from  Tennessee  moved  an  amendment, 
that  no  evidence  should  be  received  from  manufacturers  !  Thai  is, 
that  the  only  witnesses  acquainted  with  the  facts,  should  be  ex- 
cluded from  court  ! 

By  means  of  this  system  of  protection  in  Great  Britain,  opera- 
ting for  two  centuries,  with  constant  improvements  and  addi- 
tions, as  occasions  required,  the  British  manufacturing  arts  have 
acquired  a  perfection  of  skill,  and  a  strength  of  position,  which 
those  of  no  other  nation  can  rival,  and  before  which  the  latter  must 
fall,  on  a  basis  of  Free  Trade.  The  British  government  have  long 
been  aware  of  this ;  and  as  shown  in  the  preceding  chapter,  have 
been  aiming  at  this,  for  more  than  half  a  century,  by  the  employ- 
ment of  a  pensioned  corps  of  Free-Trade  writers  of  consummate 
abilities,  whose  doctrines,  like  British  manufactures,  are  fabricated, 
not  for  home  consumption,  but  for  foreign  use,  and  for  foreign 
markets. 

As  above  remarked,  the  British  government  has  always  imposed 
duties  on  manufactured  goods  competing  with  their  own,  at  the 
request  of  the  manufacturers,  and  has  never  reduced  or  removed 
them,  without  consent  of  the  interested  parties.  It  was  not  till 
wuthin  a  (ew  years  that  the  British  manufacturers  have  felt  their 
position  to  be  strong  enough  to  do  without  protection.  In  1839 
and  1840,  the  deputations  of  the  manufacturers  who  annually  ap- 
pear before  the  board  of  trade,  to  represent  their  respective  in- 
terests, and  as  witnesses  of  fact  on  this  great  question,  expressed 
to  the  board  their  willingness  to  give  up  the  protection  that  had 
been  afforded  them,  the  manufacturers  of  glass  and  silk  only  de- 
clining to  concur.  Precisely  in  accordance  with  this  representation, 
the  protective  duties  have  since  been  abolished,  except  in  the  cases 
of  glass  and  silk,  which  are  retained. 

It  is  easy  to  see  —  it  is,  indeed,  a  simple  matter  of  recorded  fact 
—  that  there  has  been  an  understanding  between  the  British  man- 
ufacturers and  their  government,  on  die  subject  of  the  abolition  of 
protective  duties,  as  much  as  before,  in  their  enactment,  measure. 


UNITED  STATES  LEAST  PREPARED  OF   ALL  NATIONS.       105 

and  continuance.  Both  parties  had  come  to  the  knowledge,  that, 
on  account  of  the  perfection  of  the  British  manufacturing  arts,  of 
their  superiority  in  skill  over  those  of  other  nations,  and  on  account 
of  the  position  which  they  occupied  in  the  hands  of  great  capitalists, 
there  was  no  risk  in  this  abolition  of  protective  duties.  They  had, 
indeed,  an  exact  measure  of  the  risk  in  the  gauge  of  duties  realized 
from  this  source,  Avhich  had  come  to  be  trifling,  and  were  the  re- 
sult of  accident,  or  of  any  other  cause  than  that  of  competition  in 
trade.  It  was  also  well  understood,  what  would  be  the  moral 
effect  on  the  world,  by  this  course  of  procedure  ;  that,  on  this 
basis,  they  could  set  up  a  challenge  for  Free  Trade  to  all  nations, 
with  the  show  of  an  example  ;  that  they  could  say,  we  have  be- 
come converts  to  our  own  writers  (pensioned  for  that  very  purpose) 
on  public  economy  ;  and  above  all,  it  was  well  understood,  that 
the  acceptance  of  this  challenge  by  other  nations,  would  result  in 
the  sole  advantage  of  the  party  which  threw  down  the  glove,  and 
the  overthrow  and  ruin  of  those  who  should  take  it  up.  The 
position  of  the  challenging  party,  was  one  of  conscious  strength  and 
superiority.  Both  the  government  and  the-  manufacturers  knew, 
that  no  nation  could  compete  with  them,  on  a  platform  of  Free 
Trade,  because  all  other  nations  were,  some  an  age,  and  some  a 
century,  behind  them,  in  skill,  and  in  strength  of  position  ;  and  they 
knew,  that  such  opponents  would  require,  at  least  equal  time  and 
equal  chances  as  had  been  enjoyed  in  Great  Britain,  under  a  system 
of  protection,  to  be  prepared  for  such  a  strife. 

There  was  another  great  and  important  understanding  between 
British  manufacturers  and  the  British  government,  in  the  adoption 
of  this  measure,  viz.,  the  abolition  of  the  corn  laws.  These  laws 
were  the  only  obstacle  in  the  way  of  the  complete  triumph  of 
British  manufactures  over  all  the  world,  on  the  basis  of  Free  Trade. 
It  had  been  seen,  that  British  arts  and  British  capital  were  going 
abroad,  to  set  up  where  food  was  cheaper,  and  vie  with  the 
home  arts  and  home  capital.  M'Gregor,  one  of  their  highest 
authorities,  and  who  had  been  made  a  principal  witness  before  the 
committees  of  parliament  on  this  subject,  had  told  them,  that, 
"from  $20,000,000  to  $25,000,000  were  annually  drawn  from  the 
kingdom,  by  persons  of  fortune,  who  go  to  France,  Italy,  Switzer- 
land, and  other  parts  of  the  continent,  where  they  can  live  better,  at 
less  expense  than  at  home.  Now,"  said  M'Gregor,  "  provided 
our  commercial  system  were  of  a  more  enlightened  character, 
[free  trade  in  corn],  measures  would   speedily  be  adopted,  which 


lOG 


GREAT  BRITAIN  ALONE  PREPARED  FOR  FREE  TRADE: 


would  have  the  effect  of  assimilating  the  prices  of  necessaries  In 
England   and   on   the  continent.     There  is  at  present  nothin-  to 
stop  the  progress  of  manufacturing  industry  on  the  continent  of 
Europe;    and  time  only  is  required  to  enable  foreign  manufac- 
turers to  produce  a  sufficient  supply  of  goods  to  supplant  us.     We 
might,  in  every  manufacture  we  now  possess,  meet  forei-n  coun- 
tries m  every  market  of  the  world,  and  in  most  instances,  mider.ell 
them."     Another  writer  «dds:  "We  allow  the  resources  which 
would  enable  us  to  accomplish  this,  to  be  counterbalanced  by  pro- 
tecting duties  on  the  importation  of  food."     And  th'eir  present  <.reat 
pensioner,  M'Culloch,  who  preaches  one  doctrine  for  home,\nd 
another  for  foreign  parts,  says  in  his  commercial  Dictionary  :  "  Our 
establishments  for  spinning,  weaving,  printing,  bleaching,  etc.,  are 
infinitely  more  complete  and  perfect  than  any  that  exist  elsewhere, 
etc.       See  pp.  93  and  94  for  this  important  extract. 

Here,  as  need  not  be  said,  the  plan  is  fully  disclosed,  confessed, 
promulgated-not,  indeed,  for  the  advice  of  foreign  nations,  though 
It  transpires  mcidentally-but  as  an  incitement  to  domestic  le^isfa- 
tion.  M'Culloch,  who  knew,  has  told  the  exact  truth,  which  brinc^s 
us  to  one  of  the  main  points  of  this  chapter,  viz.,  that  Great  Britain 
IS  the  only  nation  prepared  for  Free  Trade.  To  install  her  man- 
ufacturing arts  in  this  impregnable  position,  she  has  made  one  great 
sacrihce,  that  of  her  corn  laws. 

It  will  be  seen,  therefore,  that  this  abolition  of  duties  on  man- 
ufactures, and  on  bread-stuffs,  vaunted  forth  as  Free  Trade  to  all 
the  world,  IS  in  the  direct  line  of  her  policy  of  protection,  sustained 
for  two  hundred  years,  by  which  she  has  become  the  richest  and 
most  powerful  nation  in  the  world,  and  that  it  is  all  done  on  the 
principle  of  protection  ;    that  is,  to    protect  and   further  her  own 
interests,  and  the  interests  of  her  manufacturers  and  artisans,  against 
all  the  world.     Great  Britain  had  arrived  at  the  point,  in  her  com- 
mercial history,  when  Free  Trade,  in  these  particulars,  was  her 
true  policy,  as  much  so  as  protective  duties  had  formerly  been 
Protective  duties  once,  and  the  abolition  of  them  now,  .o  far  as 
carried  out,  are  both  based  on  the  same  principle,  viz.,  interest, 
policy,  demonstrated  by  taking  up  a  position  adapted  to  a  chano-e 
of  circumstances,  in  relation    to  the  rest  of  the   world       Grelit 
Britain  was  not  only  prepared  for  this  modification  of  her  policy 
by  having  shot  far  ahead  of  all  other  nations  in  her  manufacturing 
arts ;  but  with  this  advantage,  on  the  basis  of  Free  Trade  as  a 
general  rule  among  all  commercial  states,  she  could  distance  them 


UNITED  STATES  LEAST  PREPARED  OF  ALL  NATIONS.       107 

yet  farther  and  more  rapidly  than  before,  as  they  would  have  no 
Protection  against  lier,  when  she  no  longer  needed  it  for  herself 
ao-ainst  them.  It  would  be  the  skilful  contending  against  those 
who  are  less  skilful ;  the  strong  against  the  weak  ;  the  well-fortified 
in  their  position,  against  those  who  have  yet  to  gain  a  position  ;  the 
issue  of  which  could  not  be  doubtful. 

It  remains  to  show,  that  Great  Britain  is  the  only  nation  prepared 
for  Free  Trade  —  or  rather  to  show  it  more  clearly,  as  it  can  not 
but  be  in  part  manifest  already.  It  is  remarkable,  though  not  gen- 
erally known,  that,  although  Great  Britain  had  been  preparing  the 
way  for  more  than  half  a  century,  by  her  pensioned  writers  on  pub- 
lic economy,  for  the  proposal  of  Free  Trade  to  the  world,  it  was 
never  whispered  from  her  public  functionaries  and  statesmen,  till 
within  a  few  years.  The  thorough  doctrine  of  Free  Trade,  in- 
deed, was  never  promulgated  to  the  world,  till  after  the  battle 
of  Waterloo ;  which  event  is  not  mentioned  as  having  any  con- 
nexion with  this  full  disclosure,  but  as  an  epoch  of  European 
history,  subsequent  to  which,  some  efforts  were  made,  by  the 
states  of  Europe,  for  a  more  liberal  commercial  intercourse  with 
each  other,  secretly  instigated  by  the  British  cabinet.  Russia 
plunged  into  it  headlong,  in  1818,  and  was  obliged  to  tread  back, 
in  a  great  effort  for  her  own  rescue,  in  less  than  four  years.  In 
a  public  document,  of  1822,  from  Count  Nesselrode,  Russian  prime 
minister,  we  find  the  following  graphic  description  of  the  state  of 
things  in  that  empire,  produced  by  the  relaxation  of  their  protective 
policy:  "Agriculture  without  a  market,  industry  without  protection, 
languish  and  decline.  Specie  is  exported,  and  the  most  solid  com- 
mercial houses  are  shaken.  The  public  prosperity  would  soon  feel 
the  wound  inflicted  on  private  fortunes,  if  new  regulations  did  not 
promptly  change  the  actual  state  of  affairs.  Events  have  proved, 
that  our  ao-riculture  and  our  commerce,  as  well  as  our  manufac- 
turing  industry,  are  not  only  paralyzed,  but  brought  to  the  brink 
of  ruin."  The  remedy  was  promptly  applied,  the  protective  policy 
was  re-established,  and  now  reigns,  in  that  empire,  more  firmly 
than  ever.  The  Zoll-Verein  treaty  of  the  German  states,  formed 
for  mutual  protection  against  Great  Britain  in  particular,  and  against 
the  world  generally,  is  the  result  of  the  same  necessity.  They 
have  found  it  necessary  to  have  systematic,  as  well  as  permanent 
protection.  The  following  citation  from  a  speech  in  the  British 
parliament,  delivered  some  ten  years  after  the  peace  of  Europe,  is 
instructive  here  ;  and  certainly  it  is  frank  :  "  It  was  idle  for  us  to 


108        GREAT  BRITAIN  ALONE   PREPARED  FOR  FREE  TRADE: 

endeavor  to  persuade  other  nations  to  join  with  us  in  adopting  the 
principles  of  what  was  called  '  Free  Trade.'  Other  nations  knew, 
as  well  as  the  noble  lord  opposite,  and  those  who  acted  with  him, 
that  what  we  meant  by  '  Free  Trade,'  was  nothing  more  nor  less 
than,  by  means  of  the  great  advantages  we  enjoyed,  to  get  a  monop- 
oly of  all  their  markets  for  our  manufactures,  and  to  prevent  them, 
one  and  all,  from  ever  becoming  manufacturing  nations.  When 
the  system  of  reciprocity  and  Free  Trade  had  been  proposed  to  a 
French  embassador,  his  remark  was,  that  the  plan  was  excellent  in 
theory,  but,  to  make  it  fair  in  practice,  it  would  be  necessary  to 
defer  the  attempt  to  put  it  in  execution  for  half  a  century,  until 
France  should  be  on  the  same  footing  with  Great  Britain,  in  ma- 
rine, in  manufactures,  in  capital,  and  the  many  other  peculiar  ad- 
vantages which  she  now  enjoyed.  The  policy  that  France  acted 
on,  was  that  of  encouraging  her  native  manufactures;  and  it  was  a 
wise  policy  ;  because,  if  it  were  freely  to  admit  our  manufactures, 
it  would  speedily  be  reduced  to  the  rank  of  an  agricrdtural  nation  ; 
and  therefore  a  poor  nation,  as  all  must  be  that  depend  exclusively 
upon  agriculture.  America  acted,  too,  upon  the  same  principle 
with  France.  America  legislated  for  futurity,  and  was  prospering 
under  this  system.  In  twenty  years  America  would  be  independent 
of  England  for  manufactures  altogether.  .  .  Since  the  peace,  France, 
Germany,  America,  and  all  other  countries,  had  proceeded  upon  the 
principle  of  encouraging  and  protecting  native  manufactures." 

Napoleon  established  manufactures  in  France  as  they  had  never 
before  existed  there,  and  it  is  still  found  necessary  to  protect  them. 
The  more  that  Great  Britain  makes  her  demonstrations  of  Free 
Trade,  so  much  the  more  does  every  nation  in  Europe  find  it 
necessary  to  protect  itself —  to  stand  on  the  defensive  —  as  she 
occupies  a  position  from  which  she  can  beat  them  all.  Neverthe- 
less, there  is  a  substantial  equality  among  all  European  nations,  as 
to  the  joint  cost  of  money  and  labor,  which  are  the  two  comprehen- 
sive elements  of  every  commercial  system,  and  the  two  powers  em- 
ployed in  the  commercial  strifes  of  nations.  On  this  account,  if 
Free  Trade  would  do  anywhere,  it  would  do  among  and  between 
European  nations.  But  it  will  not  do  even  there.  Much  less  will 
it  do  between  Europe  and  the  United  States,  when  the  joint  cost 
of  money  and  labor  in  this  country,  is  more  than  a  hundred  per 
cent,  greater  than  their  cost  in  Europe,  being  so  much  against  us ; 
and  for  which  there  could  be  no  possible  compensation,  under  a 
system  of  Free  Trade,  not  to  speak  of  the  imperfect  state  of  our 


UNITED  STATES  LEAST  PREPARED  OF  ALL  NATIONS.         109 

manufacturing  arts,  as  compared  with  those  of  Europe,  and  more 
especially  of  Great  Britain. 

It  is  this  difference  of  cost  of  money  and  labor  in  the  United 
States,  as  compared  with  their   cost  in   Europe  —  the  necessary- 
consequences  of  which  are  abundantly  considered  in  subsequent 
chapters  of  this  work  —  it  is  this,  we  say,  which  establishes  the  sec- 
ond proposition  at  the  head  of  this  chapter,  to  wit,  that  the  United 
States  are  the  last  nation  that  can  afford  Free  Trade.     As  long  as 
this  difference  exists,  that  is,  as  long  as  the  states  of  society  in  these 
two  quarters  are  so  different — which  is  the  same  thinir,  or  rather 
the  cause  of  the  difference  in  the  cost  of  money  and  labor — the 
United  States  can  never  afford  Free  Trade.     Free  Trade  must 
necessarily  annihilate  this  difference  in  the  states  of  society,  not  by 
bringing  up  European  society  to  the  American  standard,  but  by- 
reducing  the  latter  to  the  level  of  the  former,  by  the  annihilation  of 
the  difference  in  the  cost  of  money  and  labor.     It  is  elsewhere 
shown,  that  the  great  thing  to  be  maintained  by  a  protective  system 
in  the  United  States,  is  American  freedom,  which  consists  in  main- 
taining the  rights  of  labor ;  that  this  was  the  great  and  sole  object 
of  the  American  revolution,  and  all  that  was  acquired  in  the  estab- 
lishment of  American  independence.     Grant  that  the  United  States 
can  afford  to  lose  all  this,  then  it  is  conceded,  that  we  can  afford 
Free  Trade. 

Some  further  light  may  be  thrown  on  this  subject,  by  consider- 
ing the  position  into  which  American  manufactures,  as  a  whole, 
would  be  thrust,  on  a  basis  of  Free  Trade,  and  the  position  into 
which  the  separate  establishments  would  be  thrust,  under  the  influ- 
ence of  the  same  cause.     As  a  whole,  they  would  be  positively 
injured,  crippled,  by  the  superior,  more  advantageous,  and  more 
commanding  position  of  British  and  other  foreign  manufacturing 
arts,  not  to  speak  of  the  difference  in  the  cost  of  money  and  labor, 
which  is  the  most  potent  cause  of  all.     They  would  be  curtailed, 
restricted,  and  impaired.     The  home  demand  for  the  aCTicultural 
products  of  the  country — which,  as  shown  in  another  chapter,  is 
by  far  the  best  market  in  every  respect,  but  more  especially  in  the 
amount  of  consumption  —  would  be  instantly  and  greatly  curtailed, 
continually  diminishing  ;    the  great   cause  of  private   and   public 
wealth,  arising  from  multiplying  arts  and  kinds  of  labor,  would 
cease  to  operate;  and  investments  of  capital  in  home  manufactures, 
would  be  checked,  abridged,  and  greatly  diminished,  by  the  ne- 
cessity of  diverting  it  to  other  channels.     But  the  most  calamitous 


110       GREAT  DKITAIX  ALONE  PREPARED  FOR  FREE  TRADE  : 

effect  would  fall  on  the  weaker  manufacturing  establishments.  Low- 
ell, and  some  other  manufacturing  towns,  equally  strong  in  their 
position,  might,  and  probably  would  stand,  and  be  able  to  breast 
the  storm,  })ositively  weaker,  but  relatively  stronger,  in  conse- 
quence of  the  overthrow  of  innumerable  infant  establishments, 
which  a  protective  system  had  started,  and  which  nothing  but  a 
protective  system  can  sustain.  The  general  prosperity  and  wealth 
of  the  country  depend  more  on  these  small  and  weak  establish- 
ments, than  on  the  great  and  strong  ones,  because  as  a  whole,  they 
have  more  capital  in  them,  employ  more  labor,  and  give  a  greater 
amount  of  activity  to  the  industry  of  the  whole  people.  The  weak 
are  naturally  allied  to  the  weak,  and  they  stand  or  fall  together  ; 
while  the  strong  are  comparatively  independent,  and  can  stand  of 
themselves.  That  public  policy  which  protects  the  weak,  protects 
all,  and  is  the  best  possible  policy.  Is  it  to  be  supposed,  that  the 
almost  innumerable  small  and  weak  manufacturing  crafts  of  this 
country,  in  the  infancy  of  their  existence,  and  with  all  the  imperfec- 
tions of  their  arts,  can  maintain  their  position,  against  the  superior 
and  more  perfect  arts  of  Great  Britain,  on  a  basis  of  Free  Trade, 
when,  besides  this  disadvantage,  itself  enough  to  crush  them,  Amer- 
ican manufacturers  have  to  pay  twice  as  much  for  money  and  la- 
bor ?     It  is  preposterous  to  suppose  it  can  be  done. 

While,  therefore,  the  strong  manufactures  of  the  United  States^ 
might  possibly  be  able  to  stand,  even  on  a  basis  of  Free  Trade,  it 
could  not  fail  to  happen  that  the  weaker  would  fall  before  the  crush- 
ing influence  of  foreign  skill  and  power  of  capital,  the  general  effect 
on  all  the  great  and  minor  interests  of  the  country,  would  be  most 
disastrous,  as  is  abundantly  shown  in  other  chapters.  The  strong 
would  become  relatively  stronger,  and  the  weak  weaker ;  the  rich 
richer,  and  the  poor  poorer ;  while  the  nation,  as  a  whole,  would 
be  impoverished.  Every  separate  manufacturing  enterprise  occu- 
pies, commercially,  an  isolated  position,  and  can  lean  only  on  itself, 
when  the  policy  of  protection  is  withdrawn.  It,  therefore,  becomes 
the  victim  of  the  whole  power  of  this  foreign  influence,  as  much  as 
if  there  were  no  other  manuficturing  establishment  in  the  country. 
If,  therefore,  it  is  weak,  can  it  stand  ?     Its  fall  is  inevitable. 

But,  in  order  to  have  a  just  view  of  the  Free  Trade  alleged  to 
have  been  granted  by  Great  Britain,  under  the  administration  of 
Sir  Robert  Peel,  it  is  equally  important  as  pertinent  here,  to  observe, 
first,  that  the  Free  Trade  granted,  is  no  sacrifice  to  the  parly  grant- 
ing it ;  next,  that  the  grant  is  limited  and  small ;  thirdly,  that  it  is 


UNITED  STATES  LEAST  PREPARED  OF  ALL  NATIONS.        Ill 

a  discriminating  Free  Trade,  granted  only  where  it  would  operate 
as  protection  ;  and  therefore,  fourthly,  that  it  is  no  Free  Trade  at 
all,  but  a  mere  matter  of  public  policy,  to  operate  in  favor  of  the 
interests  of  Great  Britain,  and  against  the  interests  of  other  nations. 
The  condensed  view  of  facts,  in  the  note  below,  collated  by  the 
careful  hand  of  Mr.  Edwin  Williams,  in  Fisher's  National  Maga- 
zine, September,  1S4G,  fully  sustains  and  verifies  the  four  proposi- 
tions above  asserted.* 

•  The  appointment  of  a  select  committee  of  the  house  of  commons  in  18-10,  on 
import  duties,  was  the  commencement  of  a  new  era  in  commercial  legislation. 
The  severe  scrutiny  to  which  the  principles  of  the  tariff'  were  exposed  by  this 
committee  was  followed  in  two  or  three  successiv'e  years,  includins;  1845,  by  some 
very  useful  amendments,  to  which  may  be  added  the  additional  amendments 
adopted  by  the  bill  introduced  the  present  year  by  Sir  Robert  Peel,  and  now 
passed  into  a  law.  An  abstract  of  the  report  of  the  Import  Duties  committee,  in 
1840,  showed  that  while  94^  per  cent,  (or  £21,700,630)  of  the  total  revenue  from 
customs  (£22,962,610)  was  obtained  from  seventeen  articles,  there  were  above 
eleven  hundred  articles  subject  to  different  rates  of  duty,  which,  in  the  language 
of  Mr.  M'Gregor,  of  the  board  of  trade,  were  "burdens,  restrictions,  and  delays, 
upon  the  industry  and  prosperity  of  the  country." 

"  The  following  is  a  list  of  the  seventeen  articles  referred  to,  each  producing 
more  than  £100,000  to  the  revenue  : — 


Am'l  Duties. 

1.  Sugar  and  molasses £4, 827 .018 

2.  Tea 3,6.58,800 

3.  Tobacco 3  495.686 

4.  Rum,  brandy,  &c 2,615.443 

5.  Wine 1.849.700 

6.  Timber 1.60:i.l94 

7.  Corn  (grain,  flour,  &c.) 1,098.779 


Am't  Duties. 

1 0.  Silk  manufactures ic24 7,362 

11.  Butter 213,077 

12.  Currants 189,291 

13.  Tallow 183,000 

14.  Seed.s 145,323 

15.  .'^beep's  wool 139.770 

16.  Rnisins 134,589 


8.  Coffee 779.114  I  17.  Cheese 100,521 

9.  Cottonwool 416.2.5"!  

Seventeen  articles  producing  duties 21,700,630 

"In  1842,  Sir  Robert  Peel  reduced  the  duty  on  about  seven  hundred  and 
fifty  diff"erent  articles,  whicli  had  yielded  only  £270,000  to  the  revenue.  At  the 
same  time  he  totally  abolished  the  duty  on  other  articles,  and  he  removed  the 
prohibition  on  the  importation  of  foreign  horned  cattle,  sheep,  goats,  swine,  sal- 
mon, soles,  and  some  other  fish,  and  beef  and  pork.  The  general  principle  of  the 
tariff"  of  1842  was  to  reduce  the  duty  on  raw  materials  to  about  5  per  cent.,  to 
limit  the  highest  duty  on  partially  manufactured  materials  to  12  per  cent.,  and  on 
complete  manufactures  to  about  20  per  cent.  In  1842,  also,  the  sliding-scale  of 
duty  on  the  importation  of  foreign  corn  or  strain  was  altered.  In  1844,  the  duty 
on  foreisn  wool  was  repealed.  In  1845,  further  alterations  were  made  in  the 
tariff':  the  duty  on  cotton  wool,  which  produced  a  revenue  of  about  £680,000, 
was  repealed  (for  the  benefit  of  the  cotton  manufacture),  and  the  duties  on  four 
hundred  and  thirty  other  articles,  which  yielded  about  £320,000  to  the  revenue, 
were  totally  abolished.  By  this  important  improvement,  the  expenses  of  ware- 
housing are  saved,  and  a  great  number  of  troublesome  accounts  and  vexatious 
impediments  to  business  are  done  away  with;  but  for  statistical  purposes,  the 
customs  department  retains  the  power  of  examining  articles  which  do  not  pay 
duties. 

"The  following  statements  show  the  net  annual  produce  of  the  duties  of  cus- 
toms on  all  articles  imported  into  the  United  Kingdom  in  the  two  years  which 


112      GREAT  BRITAIN  ALONE  PREPARED  FOR  FREE  TRADE  : 

Thus  it  is  seen,  that,  ahhough  here  is  a  showing  of  a  large  num- 
ber of  articles  on  which  protective  duties  are  abolished,  both  parties 
were  ready  for  it,  the  manufacturers,  because  it  did  them  no  harm, 
but  was  rather  beneficial ;  and  the  government,  because  they  lost 
nothing,  but  gained  in  revenue.     It  was  simply  a  question  of  pub- 

preceded  the  alterations  ia  the  tariff  made  in  1842,  and  in  the  two  years  after 
these  changes  were  effected  : — 

*              Articles  on  wliicli  tlie  Jiities  Artk-tt* s  on  whirL  no  altera 

were  reduced  in  18'J2-'3-'4.  ti(jn  was  made  in  184-2-'3-*-J. 

Two  yeara            Two  years  Two  years             Two  years 

be(i)re.                     after.  before.                     after. 

Raw  materials  for  mariufachire £1,347.599  ...  iE5l7,243. . . .  £847,481 £897,.598 

Articles  partially  inamitiK'tiired 1,048,343 648,105 2,886 3,883 

Articles  wholly  maiiulVictured 159,298 141,184 320.272 .334,.341 

Articles  of  food  (e.xchisive  of  corn  or  irrain) . .     1,082.442 1,080.992 16,933.4fi5 17,848,160 

Articlesnot  belonging  to  the  precedinij  heads.        213.577 90,872 10,421 11,408 

Totals 3,851,259  2,478,396        18,114,525        19,994,890 

"It  will  be  observed  that  the  annual  reduction  of  duties  on  raw  materials  for 
manufacture  amounted  to  Jt830,356,  and  on  articles  partially  manufactured  to 
jE400,238;  making  the  annual  boon  to  the  manufacturers  £1,230,594  —  equal  to 
$5,906,8.51;  while  the  reduction  of  duties  on  manufactured  articles  imported 
was  only  £18,114,  and  on  all  other  articles  the  reduction  was  only  £124,155. 
At  the  same  time  the  amount  of  revenue  on  articles  in  which  no  alteration  was 
made  in  the  tariff  in  l842-'3-'4,  was  actually  increased  Xl, 880,365,  while  the 
total  amount  of  reductions  on  articles  on  which  the  tariff  was  altered,  was 
£;i, 372,863.  This  shows  that  the  increase  of  the  revenue  on  the  nnchanged  arti- 
cles exceeds  the  reductions  on  other  articles  by  the  sum  of  £507,502,  or  a  back- 
ward advance  from  '  Free  Trade'  of  $2,436,000. 

"  By  the  new  British  tariff  adopted  at  the  present  sessions  of  parliament  (1846), 
further  reductions  and  repeal  of  duties  on  articles  imported  have  been  made ;  the 
government  still  pursuing  the  policy  which  has  guided  them  in  all  the  changes  in 
the  tariff  referred  to,  namely,  piomoting  the  interests  of  the  manufacturing  classes. 
Thus,  raw  hides,  mahogany,  and  other  woods  for  manufacture,  vegetables,  and  a 
few  other  articles,  are  now  added  to  the  free  list,  while  animals,  beef,  pork,  and 
some  other  articles  of  food,  being  also  admitted  free  of  duty,  the  expenses  of  liv- 
ing are  of  course  reduced  to  the  manufacturer;  add  to  this  the  reduction  of  duties 
on  bread-stuffs,  by  the  change  in  the  corn-laws,  and  we  can  estimate  in  some  de- 
gree tlie  amount  of  benefits  wliich  are  expected  to  be  derived  by  the  British  man- 
ufacturer by  the  recent  legislation  of  parliament,  and  the  increased  advantages 
those  manufacturers  will  have  in  contending  with  foreign  rivals  for  the  markets 
of  the  world. 

"  It  is  true  that  the  new  British  tariff  has  reduced  the  rates  of  duties  levied  on 
the  manufactures  of  other  nations  when  imported  into  the  United  Kingdom. 
British  statesmen  know  that  they  may  safely  rely  on  the  capital  and  skill  acquired 
during  long  periods  of  protection,  against  any  attempts  that  may  be  made  by  their 
manufacturing  rivals  of  other  countries,  to  introduce  the  products  of  their  industry 
into  Great  Britain.  In  18.'<9,  the  duties  received  on  manufactured  articles  im- 
ported into  the  United  Kingdom  amounted  to  only  £443,355,  of  which  silk  goods 
imported  contributed  more  than  one  half.  Two  years  after  the  alteration  of  the 
tariff  in  l842-'3-'4,  the  annual  amount  of  duties  on  manufactures  imported  was 
j£475,525 ;  which  shows  but  a  small  increase  of  imports  in  consequence  of  the 
reduction  of  duties.  The  duties  on  silic  inanufactures,  in  1839,  amounted  to 
£247,361,  and,  in  1844,  to  £286,535,"  being  about  two  thirds  of  all  the  duties 
collected  from  manufactured  articles  from  foreign  parts. 


UNITED  STATES  LEAST  PREPARED  OF  ALL  NATIONS.  113 

lie  policy.  That  Free  Trade  ha'd  nothing  to  do  with  it,  although 
vaunted  as  such,  is  evident  from  the  facts,  that  this  abolition  of  du- 
ties was  discriminating,  being  confined  to  a  limit  which  would  oper- 
ate for  the  benefit  of  all  parties  concerned,  in  Great  Britain,  public 
and  private.  The  differential  duties  for  the  colonies  and  remote 
dependencies  of  the  empire,  giving  a  monopoly  of  the  trade  of  those 
parts  to  British  manufacturers,  were  still  retained.  Not  a  word  is 
said  about  them.  What  was  granted  to  other  nations,  by  this  meas- 
ure, was  worth  nothing  to  them,  and  operated  for  the  benefit  of  the 
grantors  ;  while  a  Free  Trade  with  the  colonies  and  dependencies 
of  Great  Britain,  would  have  been  a  substantial  boon,  especially  to 
the  United  States.  These  differential  duties,  indeed,  were,  as  we 
believe,  enacted  expressly  to  shut  out  the  trade  of  the  United  States, 
and  to  monopolize  it  for  British  commerce. 

The  privileges  secured  to  British  bottoms,  by  commercial  treaties 
and  domestic  legislation,  on  condition  of  touching  at  a  colonial  port, 
in  returning  with  cargoes  from  foreign  ports,  are  another  species  of 
,  differential  law,  of  immense  consequence  to  the  parties  concerned, 
all  in  favor  of  British  and  against  foreign  bottoms.  We  began,  in 
1817,  to  try,  by  countervailing  legislation,  to  recover  a  commerce 
then  worth  six  millions  annually,  lost  by  this  species  of  legerdemain, 
and  which  has  been  growing  more -valuable  ever  since,  and  we 
have  gained  nothing  of  our  rights,  but  rather  lost,  by  the  commer- 
cial treaty  of  1830.  The  effect  of  this  treaty  has  been,  that,  in  fif- 
teen years,  from  1830  to  1844,  the  British  commerce  with,  the 
United  States  gained  300  per  cent.,  while  our  commerce  with 
Great  Britain,  for  the  same  time,  gained  only  50  per  cent.  Great 
Britain  raises  a  revenue,  by  duties  on  American  tobacco,  of  some 
eighteen  to  twenty  millions  of  dollars  a  year.  Look  at  her  exac- 
tions for  revenue  in  other  items,  given  in  the  note  on  pages  111  and 
112,  in  which  we  and  other  nations  are  profoundly  interested,  and 
see  what  a  mockery  is  that  which  she  has  given  up,  calling  it  Free 
Trade  —  all  for  her  benefit — as  compared  with  that  which  she  re- 
tains, also  for  her  benefit  alone.  Why  talk  of  Free  Trade,  with  such 
facts,  and  such  unsettled  accounts  as  these,  staring  the  world  in  the 
face  ?     It  is  a  perversion  of  language,  and  a  shame  to  decency. 

Two  remarks  will  comprehend  and   show  all  the  Free  Trade 
which  Great  Britain  has  conceded  :  First,  she  has  never  granted 
Free  Trade  on  any  article  of  her  own  production,  which  was  a  sacri- 
fice to  herself;  secondly,  nor  on  any  article,  in  the  production  of.i 
which  she  was  not  prepared  to  beat  all  the  world. 

8 


V, 


^'•^Y^       '^"^    *"^'     DEFINITION    OF    FREEDOM.  /        •^»»'^ 


CHAPTER   VII. 

FREEDOM  CONSISTS  IN  THE  ENJOYMENT  OF  COMMERCIAL 
RIGHTS,  AND  IN  THE  INDEPENDENT  CONTROL  OF  COMMER- 
CIAL   VALUES    FAIRLY    ACQUIRED. 

The  Novelty  and  Importance  of  this  Proposition,  a  Reason  for  giving  it  an  early  Place  in 
this  Work. — What  is  Meant  hy  it. — Definition  of  Commercial  Rights  and  Values. — 
Liberty  not  synonymous  with  Freedom. — Rights  as  di.wtinguished  from  Liberty. — Free- 
dom, not  an  Abstraction,  but  a  Reality. — Is  a  definable  Substance. — The  Objects  of 
Despotism  of  every  kind,  even  Spiritual,  are  Commercial  Values. — All  Religious  Privi- 
leges are  Secured  and  Fortified  by  Commercial  Values. — Freedom  requires,  that  all 
Taxes  should  be  Voluntary,  by  a  Representative  Voice. — Otherwi.se  they  are  an  Ex- 
tortion, and  not  Freedom. — ■'  Voting  Supplies." — The  British  Government  more  imme- 
diately under  the  Control  of  Popular  Freedom  than  that  of  the  United  States. — The 
Mexican  War  an  Example — Many  things  arc  called  Freedom  which  are  only  its  Acci- 
dents and  Results. — A  reasonable  Man  will  be  contented  with  Freedom  as  here  defined. 
— A  Man's  Commercial  Rights  includes  bis  Chances  in  the  Future. — The  Blood  of  Mar- 
tyrs shed  on  Account  of  Commercial  Values. — The  Te.=t  of  the  Principle  contended  for. 

"^ ;  ^^^*^  As  the  proposition  at  the  head  of  this  chapter  is  a  new  one,  and 

^/IAC*^  as  it  defines  a  fundamental,  most  important,  and  most  vital  element 

/•  C*^       of  a  system  of  public  economy  adapted  to  the  United  States,  per- 

^"JlJl^        vading  the  whole,  we  have  thought  proper  to  give  it  an  early  place 

in  this  work,  in  connexion  with  the  subjects  of  several    chapters 

immediately  succeeding  this,  which  naturally  grow  out  of  it.     The 

novelty  of  this  position  may,  perhaps,  be  an  apology  for  a  somewhat 

elaborate  argument  on  the   point.     Having  been  persuaded,  that 

what  men  call  freedom,  and   profess  to  value  so  highly,  must  be  a 

reality   of  a  tangible  shape  and   substance,  definable  as  any  other 

reality  is,  we  have  studied   to  find  it  out,  and  to  give  it  a  definite 

form,  and  the  result  is  the  definition  above  offered. 

By  cominercial  rights,  we  mean  those  claims  to  property  which 
men,  by  general  consent,  are  allowed  to  assert — of  property, 
which,  by  the  same  consent,  they  may  rightfully  call  their  own, 
having  in  it  what  the  economists  usually  call  exchangeable  value ; 
but  which  we  prefer  to  call  commercial  value,  as  we  think  the 
substitute  being  less  technical,  is  quicker  and  better  apprehended. 
j«J^/\  By  commercial  values,  we  mean  the  things  themselves,  to  which 
'       \ff^  these  rights  appertain. 

.         af^^  Air  and  water  are  neither  bought  nor  sold,  and  are,  therefore, 
I'        I  ^not  ranked  among  commercial  values.     They  are  not  produced  by 


I  M  not  rai 


DEFINITION    OF    FREEDOM.  115 

human  labor  ;  and  therefore,  in  a  commercial  view,  cost  nothing. 
Instruments  which  supply  us  with  water,  such  as  wells  and  aque- 
ducts, or  any  other  facility  in  bringing  this  element  to  our  use,  and 
adapting  it  to  our  purposes  by  heating  it,  or  by  converting  it  into 
steam,  are  works  of  art,  and  products  of  labor;  and,  therefore,  are 
properly  ranked  among  commercial  values.  But  the  element 
itself  is  a  product  of  nature  —  a  bounty  of  Providence.  No  man 
sells  water,  though  he  may  sell  the  labor  which  brings  it  to  our 
use.  In  the  same  manner  air  is  free  to  all,  though  the  means  of 
enjoying  it  to  our  highest  satisfaction  and  greatest  benefit,  such  as 
windows,  fans,  public  squares,  and  favorable  grounds,  may  cost 
something;  and  are,  therefore,  commercial  values.  In  the  same 
manner  also,  all  the  provisions,  offices,  and  agencies  of  nature, 
such  as  the  sun,  and  rain,  to  produce  and  fructify;  winds,  rivers, 
and  oceans,  to  facilitate  navigation  and  transport ;  the  earth  and  all 
its  wealth,  superficial,  subterranean,  and  submarine  ;  every  product 
and  arrangement  of  the  Creator,  properly  called  Providence  ;  all 
these  supplies  and  agencies,  ministering  to  the  wants,  and  gratify- 
ing the  desires  of  man,  cost  him  nothing  before  they  have  been  ap- 
propriated by  regulations  of  the  social  compact.  They  are  not, 
therefore,  reckoned  among  commercial  values ;  but  are  rather  a 
basis  on  which,  and  instruments  by  which,  the  labor  of  man  pro- 
duces such  values.  When  any  portions  of  them  are  appropriated, 
such  as  land,  water  power,  mineral  regions,  etc.,  it  is  done  under 
the  social  compact,  and  the  principle  of  a  quid  pro  quo  is  recog- 
nised, by  right  either  of  discovery,  or  of  possession,  or  of  purchase. 
The  law  supposes,  that  all  such  rights  have  cost  something,  that 
the  cares,  labor,  and  industry  of  man  have  created  these  values, 
over  and  above  the  provisions  of  nature. 

We  prefer  the  term  freedom  to  that  of  liberty,  not  only  as  being 
the  substantive  of  free,  and  therefore  most  proper  ;  but  because 
there  is  in  fact  an  important  difference  in  the  scope  and  spirit  of    ^/^AfMf\ 
the  words.     Liberty  is  often  used  in  the  sense  of  licentiousness  ;  ^ 

freedom  never.     The  former  is  not  unfrequently  employed  to  de-  *^'^E/yy 
note  a  state  of  things,  under  which  a  man  may  do  as  he  pleases,        O  * 

without  regard  to  social  rights  ;  whereas,  freedom  is  rarely,  if  ever, 
used  in  a  sense  inconsistent  with  social  rio;hts.  Riffhts  are  the 
things  which  we  want,  and  not  liberty  in  the  latitudinarian  sense 
of  the  term.  It  will  be  found  that,  as  rights  are  multiplied,  liberty 
is  abridged.  For  example,  the  law  directs  to  take  the  right  on  a 
bridge.     Therefore  a  man  is  not  at  liberty  to  take  the  left.     Public 


116  DEFINITION    OF    FREEDOM. 

convenience  requires  the  establishment  of  this  right,  and  the  abridg- 
ment of  this  liberty.  So  of  all  rights  established  by  common  and 
statute  law.  Not  one  of  them  is  created  without  the  abridfrment 
of  liberty.  It  is  to  be  feared,  that  the  lack  of  making  this  distinc- 
tion between  liberty  and  rights,  has  produced,  and  is  perpetually 
producing,  a  great  deal  of  mischief  in  society,  and  that  many  of  the 
cries  for  liberty  are  no  other  than  claims  to  do  as  one  pleases,  in 
violation  of  rights ;  whereas,  the  only  freedom  that  is  desirable  and 
worth  contending  for,  is  that  state  of  things  which  secures  rights, 
and  suppresses  that  liberty,  or  which  is  the  same  thing,  that  licen- 
tiousness, which  would  violate  them. 

Freedom,  with  most  people,  is  an  abstract  and  vague  notion, 
supposed  to  be  valuable,  and  even  worth  fighting  and  dying  for. 
But  ask  people  what  freedom  is,  and  there  is,  perhaps,  not  one  in 
a  thousand  that  can  tell.  It  is  not  an  abstraction,  but  a  practical 
good.  It  is  a  palpable  thing,  a  tangible  blessing.  But  what  is  it? 
In  what  does  it  consist?  Our  definition  answers,  that  it  consists 
in  the  enjoyment  of  commercial  rights,  and  in  the  independent  con- 
trol of  commercial  values,  fairly  acquired. 

Oppressors  do  not  rob  men  of  water,  or  of  air,  except  in  extra- 
ordinary cases  of  a  cruel  despotism,  for  punishment  or  vengeance. 
Such  deprivations  are  wanton  acts  of  inhumanity,  of  barbarity. 
Such  are  not  the  things  which  oppressors  usually  want;  but  they 
want  that  which  costs  labor ;  they  want  commercial  values.  On 
this  single  and  simple  principle,  as  upon  a  pivot,  turns  the  entire 
system  of  social  wrongs  and  social  rights,  comprehending  all  that 
ever  were,  or  ever  can  be.  It  is  the  principle  of  mevm  et  tuum, 
mine  and  {h'me  —  a  principle  recognised  from  the  origin  of  the 
social  state,  and  which  is  not  peculiar  to  man,  but  is  constantly 
seen  developed  among  all  the  animal  tribes.  Disturb  the  den  of  a 
wild  beast,  or  the  nest  of  a  bird,  and  you  will  see  it  quickly  man- 
ifested. 

It  will,  perhaps,  be  thought  by  some,  that  our  definition  of  free- 
'^  '  dom  is  not  sufficiently  comprehensive  ;  especially,  that  it  does  not 
reach  the  case  of  exemption  from  spiritual  despotism.  We  sub- 
mit, however,  that  the  object  of  every  system  of  spiritual  despotism, 
as  a  system,  is  to  get  possession  and  control  of  commercial  values, 
which  constitute  the  arm  of  physical  power.  Without  these,  this 
species  of  sway  would  be  of  no  avail,  and  there  would  be  no  motive 
for  the  attempt  to  gain  and  hold  it.  While  the  subjects  of  this 
influence  remain  in  the  unimpaired  possession  of  their  commercial 


DEFINITION    OF    FREEDOM.  117 

rights,  they  are  not  and  can  not  be  subdued  ;  foi  they  have  the 
power  in  their  own  hands.  All  history  pertaining  to  this  point — 
and  history  must  decide  the  question  —  evinces,  that  spiritual  des- 
potisms are  always  erected  for  temporal  sway  as  an  end.* 

It  is  sufficiently  obvious  that  temporal  power,  for  the  oppression 
of  the  human  race,  can  only  be  established  and  maintained,  by 
physical  means  —  means  derived  from  the  commercial  values  of 
society.  Despotism  can  not  exist  permanently,  except  at  the  ex- 
pense of  its  victims,  in  a  commercial  point  of  view.  To  make  the 
arm  of  despotism  strong,  its  victims  must  be  made  commercially 
weak,  by  depriving  them  of  such  a  portion  of  their  commercial 
values,  as  to  create  a  formidable  and  irresistible  physical  power 
over  them,  and  by  keeping  them  in  a  position  of  relative  impotence 
as  to  the  means  of  asserting  and  vindicating  their  rights.  They 
must  first  be  robbed,  before  they  can  be  oppressed.  Let,  there- 
fore, the  commercial  rights  of  the  people  be  secured  and  maintained, 
and  there  is  no  danger  of  spiritual  or  any  other  despotism,  first, 
because  there  is  no  adequate  motive ;  next,  because  it  has  nothing 
to  feed  upon  ;  and  thirdly,  because  it  has  nothing  wherewithal  to 
maintain  its  power.  The  strength^  the  might  of  the  nation,  in  such 
a  case,  is  Avith  the  people.  All  the  ability  of  a  despotism  to  hold 
and  defend  its  position,  is  composed  of  commercial  values  wrong- 
fully acquired.  Give  back  the  rights,  and  the  power  is  restored 
with  them  ;  or  if  the  people  have  not  parted  with  their  rights,  the 
power  could  not  be  easily  usurped.  It  is  true,  indeed,  that  the 
government  of  a  country  always  has  the  advantage  of  the  people, 
in  proportion  to  the  commercial  values,  or  means  of  power,  in  the 
hands  of  each  party,  because  it  is  one  of  the  duties  of  a  govern- 

*  Directly  in  point,  as  to  ihe  aims  of  spiritual  despotism,  above  asserted,  is  the 
following  extract  from  an  able  article  in  the  Courier  Des  Etats  Unis,  New  York, 
September  9,  1847,  on  the  spiritual  and  temporal  power  of  the  bishop  of  Rome  : — 

"  Du  jour  oil  le  pape  s'est  trouve  revctu  de  ces  deux  caractcres,  11  a  du  con- 
siderer  I'un  comme  un  but,  I'aulre  comme  im  moyen.  Or,  de  la  souverainete 
spirituelle  ou  de  la  souverainete  temporelle,  laquelle  est  le  but,  laqnelle  est  le 
moyen  ?  Lorsque  nous  jctons  les  yeux  sur  I'histoire  et  que  nous  voyons  les  papes 
devenir  les  arbitrcs  de  l"Europe,  les  mediateurs  des  querelles  de  prince  a  prince  et 
de  prince  a  peuple,  les  dispensateurs  des  trones  ;  quand  nous  sondons  les  celobres 
questions  des  investitures,  des  Guelfes  et  des  Gibelins ;  quand  nous  examinons 
I'echec  prepare  a  Wiclef,  a  Jean  Huss,  a  Jerome  de  Prague,  les  luttes  engagees 
centre  les  conquetes  de  Luther,  de  Zuingle  et  de  Calvin;  quand  nous  suivons 
Borgia  et  Paul  Farncse  guerroyant  pour  la  destinee  princiure  des  produits  males 
de  leur  cclibat  fecond,  nous  sommes  forcement  conduits  a  dire  que  le  but  papal  a 
ete  la  souverainete  temporelle  et  non  point  la  souverainete  spirituelle ;  cette  der- 
niere  reste  done  a  I'etat  de  moyen." 


118  DEFINITION    OF    FREEDOM. 

merit  to  be  always  prepared  for  the  exigencies  of  war ;  in  other 
words,  to  be  armed,  and  ready  for  arming  more  effectually,  on 
short  notice.  It  must  be  obvious,  therefore,  that,  in  case  of  a  con- 
troversy between  the  government  and  people,  it  is  as  easy  for  the 
former  to  turn  its  arms  against  the  latter,  as  against  a  foreign  foe, 
while  the  people  are  unprepared  for  the  contest.  Hence  the  security 
of  freedom  requires,  first,  that  no  more  of  the  commercial  values 
of  a  people  should  be  absorbed  by  the  government,  than  is  neces- 
sary for  the  safety  of  the  commonwealth  against  foreign  machina- 
tions; and  next,  that  popular  influence  should  be  sufficiently  ele- 
vated and  strong,  to  control  executive  power. 

But  some,  perhaps,  will  say,  there  is  a  subtlety  In  spiritual 
despotism,  that  is  independent  of  physical  power.  A  system- 
atized spiritual  despotism  is  undoubtedly  dangerous  to  freedom  ; 
and  all  such  systems  have  the  end  of  physical  power  in  view. 
So  long  as  spiritual  influence,  in  its  isolated  positions,  has  no 
such  aims,  and  stops  short  of  such  an  end,  it  can  hardly  be  seen 
why  it  should  be  a  subject  of  any  great  concern.  But  when  it 
emanates  from  an  established  polity,  existing  for  ages,  ever  assert- 
ing imperious  pretensions,  and  never  failing  to  avail  itself  of  physical 
power,  when  it  can,  it  is  safer  to  be  vigilant  of  its  operations,  than 
indifferent  to  them.  And  it  wil!  be  found,  that  the  principle  of  the 
doctrine  asserted  at  the  head  of  this  chapter,  applies  to  such  a  case. 
Every  religious  privilege,  in  its  social  character,  comprehends  a 
commercial  right.  A  man's  domicil,  and  everything  pertaining 
thereunto,  is  a  commercial  right.  No  spiritual  power  can  lawfully 
invade  that  sanctuary.  It  is  sacred  to  man  and  to  God.  In  that 
retreat  is  or  should  be  the  tenant's  domestic  altar;  and,  in  relation 
to  society,  it  is  a  commercial  right.  There  he  may  worship  his 
God,  without  question  from  any  other  authority  than  that  of  the 
object  of  his  devotions.  It  is  a  high  and  sacred  privilege  ;  but,  in 
relation  to  man,  it  is  no  less  a  commercial  right.  His  closet,  his 
bible,  if  he  is  a  Christian,  and  his  aids  to  devotion,  are  there.  Be- 
tween him  and  his  God,  they  are  sacred  privileges;  between  him 
and  society,  they  are  commercial  rights.  They  have  cost  him 
care  and  labor,  and  they  are  his.  He  has  the  same  commercial 
rights  in  the  place  of  public  worship,  if,  in  one  way  or  another,  he 
contributes  of  his  earthly  substance  to  its  support. 

It  must,  we  think,  be  seen,  tiiat  the  range  of  these  rights,  as  con- 
nected with  religion,  is  sufficiently  comprehensive,  when  vindicated, 
to  bar  the  encroachments  of  spiritual  despotism.     Let  these  rights 


DEFINITION    OF    FREEDOM.  119 

remain  unimpaired,  and  be  fidly  enjoyed,  and  it  is  all  the  religious 
freedom  that  any  man  could  desire.  And  it  will  be  observed,  that 
they  are  commercial  rights.  Our  object  is  to  show,  that  the  bul- 
warks of  freedom  are  composed  of  rights  of  this  kind,  and  of  this 
kind  only.  And  if  this  be  true  of  religious  freedom,  it  is  much 
more  so  of  civil.  Religious  and  civil  freedom  are  indeed  identical, 
in  their  relations  to  the  state. 

But  there  is  a  quantum  of  every  man's  commercial  values  due 
to  the  state,  as  a  consideration  for  his  benefit  in  the  commonwealth. 
How  much  ?  By  what  rule  of  measurement  shall  it  be  graduated? 
It  will  be  observed,  that  we  are  speaking  of  freedom.  It  would  be 
a  solecism  to  suppose,  that  any  man's  commercial  values  can  be 
taken  without  his  consent,  and  he, be  free.  Force  of  this  kind  is 
the  essence  of  despotism.  Possibly  it  may  not'  be  felt  as  such, 
when  exerted  only  to  a  small  extent ;  but  this  does  not  alter  the 
principle.  An  improper  act  is  not  characterized  by  degrees;  but 
by  the  principle  on  which  it  is  based.  Extortion  in  a  trifle  may 
not  be  grievous;  but  multiply  and  extend  it,  and  it  becomes  an 
aggravated  evil.  Even  the  brute  creation  know  what  is  their  own 
—  are  conscious  of  their  ri<;;hts  in  relation  to  each  other.  Much 
less  does  man  need  to  be  told  what  is  his  property,  or  that  it  can 
not  lawfully  be  taken  from  him  without  his  consent,  without  a  quid 
2>ro  quo.  On  this  principle  is  based  his  right  of  voice  in  his  con- 
tributions to  the  state  —  a  right  which,  of  course,  can  be  exercised 
only  mediately,  or  in  a  representative  capacity.  It  is  essential  to 
freedom,  that  government  should  be  the  creation,  and  under  the 
control,  of  those  vvho  contribute  of  their  commercial  values  to  sus- 
tain it.  In  this  way,  their  taxes  to  the  public  are  graduated  by  their 
own  sovereign  will.  They  pay  them  as  they  pay  any  other  de- 
mand, for  which,  as  parties  to  an  agreement,  they  receive  a  valu- 
able consideration.  There  is  no  more  force  in  their  taxes,  than  in 
what  they  |iay  for  the  necessaries  and  comforts  of  life.  This  is 
freedom,  and  no  other  state  of  things  can  be  freedom. 

It  should  be  observed,  that  this  principle  is  not  only  comprehen- 
sive, but  fundamental  and  vital  to  the  subject.  There  is  nothing 
that  men  have  ever  been  dissatisfied  with,  as  the  opposite  of  free- 
dom, in  the  various  forms  of  slavery  or  despotism,  which  is  not 
reached  by  this  as  a  radical  cure.  We  have  already  seen,  that  it 
is  a  remedy  for,  or  a  preventive  of,  spiritual  despotism.  In  the 
same  manner,  it  is  so  in  application  to  every  other  species  of  op- 
pression.    It  occupies  precisely  the  position  of  what  is  commonly 


120  DEFINITION    OF    FREEDOM. 

called  "  voting  supplies"  in  the  popular  branch  of  a  legislative  body, 
only  that  it  goes  farther  back,  is  fundamental,  and  begins  at  the  be- 
ginning. It  is  well  known,  that,  under  a  constitutional  government, 
as  in  the  United  States  and  Great  Britain,  the  executive  arm  can 
be  crippled  at  any  moment,  and  in  that  way  controlled,  by  the  re- 
fusal of  supplies  on  the  part  of  an  independent  legislative  body,  and 
that  this  power  is  commonly  and  justly  regarded  as  one  of  the  most 
efficient  bulwarks  of  freedom.  The  powerful  government  of  Great 
Britain  is  brought  instantly  to  a  stand,  when  the  house  of  commons, 
the  popular  branch  of  the  legislature,  votes  against  it,  and  it  can 
not  go  forward  without  a  change  of  ministry,  alias  of  the  govern- 
ment, in  conformity  to  the  intimations  of  that  vote.  This  power  is 
based  on  the  principle  now  under  consideration,  that  is,  the  power 
of  withholding  those  commercial  values,  commonly  called  supplies, 
which  are  necessary  to  the  executive,  and  without  which  it  can  do 
nothing  constitutionally.  In  this  particular,  the  British  government 
is  more  subject  to  the  popular  will,  so  far  as  the  franchise  extends, 
than  that  of  the  United  States,  and  may  be  forced  to  reconstitute 
the  administration,  and  change  the  public  policy,  at  any  time,  in  a 
single  day  ;  whereas,  the  government  of  the  United  States,  or  its 
administration,  can  not  be  changed  but  once  in  four  years,  however 
the  people  may  be  dissatisfied  with  the  policy  and  measures  adopt- 
ed. In  this  particular,  therefore,  popular  freedom  has  gained  more, 
for  its  prompt  and  instantaneous  influence,  under  the  government 
of  Great  Britain,  than  under  that  of  the  United  States  ;  but  this  ad- 
vantage suffers  a  large  abatement  in  the  comparative  extent  of  the 
franchise  in  these  two  quarters,  it  being  very  limited  in  the  former, 
.and  nearly  or  quite  universal  in  the  latter.  Although  freedom  can 
not  act  in  the  United  States,  on  the  most  comprehensive  scale,  but 
once  in  four  years,  for  any  change  in  public  policy  that  may  be  de- 
sired;  yet,  on  account  of  the  extent  of  the  franchise  here,  when  it 
does  act,  it  is  capable  of  exerting  a  sweeping  and  powerful  influ- 
ence. Nevertheless,  it  would  apparently  have  been  better  —  cer- 
tainly more  favorable  to  freedom  —  if,  in  addition  to  the  extended 
right  of  suffrage,  the  government  of  the  United  States  had  been  so 
constituted,  as  not  to  allow  an  administration,  once  installed  in 
the  place  of  power,  to  govern  the  nation  badly,  if  so  disposed,  for 
the  full  term  of  four  years,  in  spite  of  the  will  of  the  people.  Four 
years  of  power,  in  such  a  country,  badly  used,  is  enough  to  inflict 
upon  it  calamities  which  would  require  many  years  to  remedy  — 
possibly  such  as  could  never  be  repaired.     Take,  for  example,  the 


DEFINITION    OF    FREEDOM.  121 

Mexican  war.  Would  it  not  have  been  well,  if  there  had  been  a 
power  in  the  people  to  arrest,  or  to  have  prevented  it?  Consider 
the  amount  of  commercial  values,  the  costs,  that  have  been  and 
must  be  wrested  from  them,  before  it  will  be  paid  for !  As  a  free 
people,  would  they  ever,  with  their  eyes  open,  have  voted  such 
costs,  and  such  public  disasters  ?  Kings  make  war,  and  the  peo- 
ple pay  the  cost  with  their  blood  and  treasure.  If  the  people  were 
consulted,  there  would  be  few,  if  any  wars,  except  for  defence  of 
popular  prerogatives.  The  war  of  the  American  revolution,  as 
will  be  found  upon  examination,  was  waged  solely  for  the  vindica- 
tion of  commercial  rights  —  the  rights  of  every  man  in  his  own  po- 
sition, and  in  that  way  the  rights  of  the  community.  In  this  great 
fact  we  have  a  most  impressive  verification  of  the  doctrine  main- 
tained in  this  chapter. 

The  revolutionary  struggle  of  our  forefathers,  was  not  for  an  im- 
palpable phantom  called  liberty,  which  millions  have  chased,  and 
(ew  ever  caught  to  hold  except  to  their  own  disappointment.  The 
wrongs  which  they  complained  of,  under  a  tyrannical  British  sway, 
were  a  deprivation  of  commercial  rights ;  what  they  contended  for 
and  ultimately  gained,  was  the  restoration  and  re-establishment  of 
those  rights.  It  was  a  palpable  benefit — an  instrument  where- 
withal to  purchase  and  secure  other  benefits.  It  was  that  without 
which  man  can  not  have  the  desirable  things  of  life.  It  was  sub- 
stantial wealth,  of  which  they  had  been  deprived  by  unjust  legisla- 
tion, and  a  despotic  government.  It  was  the  sweat  of  the  people's 
brow  that  was  drawn  away  by  taxes  without  representation,  by  ex- 
pensive civil  and  military  establishments  maintained  at  the  expense 
of  the  people  to  keep  them  in  subjection.  In  this  way  they  were 
deprived  of  their  commercial  rights,  and  kept  poor,  without  a  voice. 
It  was  to  have,  to  hold,  to  control,  and  to  enjoy  ilteir  own,  that  our 
forefathers  went  through  the  revolutionary  contest.  This  is  free- 
dom ;  and  nothing  else  is  freedom.  Life,  liberty  of  opinion,  of 
speech,  and  of  the  press,  are  the  accidents  of  freedom  —  the  results, 
though  often,  but  erroneously,  taken  for  freedom  itself.  It  is  only 
by  the  usurpation  of  the  commercial  values  of  a  people,  whereby  a 
physical  power  over  them,  to  hold  them  in  bondage,  is  maintained, 
that  life  and  its  blessings  can  be  put  in  jeopardy. 

Besides  these  cursory  views  which  go  to  the  establishment  of  the 
proposition  at  the  head  of  this  chapter,  a  close  scrutiny  of  every 
one's  own  experience  will  lead  to  the  same  result.  Give  a  man  the 
use,  enjoyment,  and  control  of  that  which  he  calls  his  own  —  all 


122  DEFINITION    Of    FREEDOM. 

^/„^/j  of  which  consists  in  comnnercial  values,  or  that  which  such  values 
'  only  can  secure  to  him  —  and  he  will  ask  for  nothing  more.  He 
does  not  want  any  other  freedom  on  earth,  as  a  reasonable  man. 
No  man  ever  complained  of  oppression  or  of  wrong  from  govern- 
ment, who  had  all  this  ;  certainly  no  insurrection  was  ever  known 
in  such  a  state  of  things.  It  would  be  morally  impossible  to  disturb 
such  a  state  of  society,  with  a  view  to  revolutionize  it.  This  con- 
sideration alone  might  satisfy  every  reflecting  mind,  that  this  is 
freedom,  when  it  is  seen,  that  man  can  reasonably  desire  nothing 
more  in  the  social  state. 

And  it  must  be  considered,  that  a  man's  commercial  rights  com- 
prehend, not  only  what  he  may  already  have  fairly  acquired  of  this 
kind,  but  all  his  fair  chances  of  future  like  acquisitions,  by  his  own 
capital,  labor,  skill,  or  talents.     Capital,  labor,  skill,  and  talent,  not 
yet  exerted  or  put  to  use,  are  as  much  commercial  values  as  their 
products  already  in  possession,  and  are  equally  in  the  market  for 
sale  or  employment.     It  would  be  but  a  small  part  of  freedom,  for 
a  government  to  allow  a  man  the  possession,  use,  and  control  of 
that  which  he  has  acquired,  if  it  deprives  him  of  that  which  he  is 
capable  of  acquiring,  or  of  his  chances.     It  is,  perhaps,  the  chan- 
ces of  the  future  which  men  prize  most.     Cut  those  off,  bar  them, 
and  the  most  tender  point  of  human  expectations,  of  men's  claimed 
rights,  is  assailed.     Men,  in  the  vigor  of  life,  who  are  objects  of 
fear  to  tyrants,  and  who  alone  can  revolutionize  a  state,  do  not  lean 
•         so  much  on  the  past,  as  they  press  forward  to  the  future.     Deprive 
such  men  of  their  chances,  destroy  their  hopes,  and  they  will  feel 
it  more  than  any  other  deprivation  of  which  they  could  be  made 
the  subjects.     Men  will  even  forgive  past  injuries  inflicted  by  a 
government,  will  at  least  forget  them,  if  they  can  have  security  for 
their  rights  in  the  future.     It  is  for  the  future  chiefly  that  men  love 
freedom,  and  will  contend  for  it ;  and  what  they  love  and  contend 
for,  is  commercial  values,  because,  it  is  by  these  only  that  they  can 
supply  their  wants,  and  gratify  their  desires.     There  is  no  earthly 
good,  be  it  substance  or  privilege,  which  is  not  purchasable  by 
these ;  and  no  privilege  that  is  not  surrounded  and  fortified  by 
these.     It  is  true,  indeed,  that  religion  and  the  grace  of  God  are 
independent  of  such  aids,  and  come  down  a  munificence  from  on 
high,  to  console  the  poor  and  the  afflicted  —  to  indemnify  even  the 
persecuted  and  the  oppressed.     But  no  thanks  to  man  for  this. 
This  bounty  of  Heaven  does  not  at  all  affect  the  claims  of  every 
man  for  his  commercial  values,  as  between  him  and  his  fellows, 


DEFINITION    OF    FREEDOM.  123 

and  which,  though  also  bounties  of  Heaven,  constitute  a  basis  of 
social  rights  between  man  and  man,  as  spiritual  benefits  descending 
direcdy  from  Heaven  can  not,  on  account  of  their  impalpable  nature 
as  subjects  of  human  regulation  and  control.  These  latter  benefits 
are  above  the  jurisdiction  of  society,  and  independent  of  it,  except 
so  far  as  the  means  of  obtaining  and  enjoying  them  are  concerned, 
which,  as  before  shown,  are  also  properly  ranked  among  commer- 
cial riuhts.  .  \ 

It  is  for  this  reason  that  men  will  fight  and  die  for  their  religion,    \yCr/ 
that  is,  for  the  means  of  religion,  which  are  necessarily  of  a  com- 
mercial character.     They  do  not  fight  and  die  for  the  grace  of  God, 
in  the  highest  sense  of  the  term ;  for  man  can  not  deprive  them  of 
that,  and  none  have  ever  enjoyed  it,  in  so  large  and  rich  a  measure, 
as  Christian  martyrs.     It  was  for  social  rights,  alias  for  freedom, 
which  always  involves  commercial  rights,  that  the  blood  of  martyrs 
has  flowed  so  profusely.     Persecuting  and  murderous  tyrants  have 
never  been  able  to  take  anything  from  their  vicdms,  who  have  suf- 
fered for  the  faith  of  Christ,  but  their  commercial  values,  of  which 
life  itself  was  one.    At  the  same  time  that  the  martyrs  were  stripped 
of  every  earthly  good,  and  were  sacrificed  at  the  stake,  or  on  the 
rack,  or  in  the  flames,  or  by  the  ferocity  of  wild  beasts,  or  by  any 
other  instruments  of  cruelty,  not  less  various  than  the  prolific  inge- 
nuity of  fiendly  malice  could  supply,  they  were  infinitely  more  than 
indemnified  by  the  presence  and  the  grace  of  God,  and  the  crown 
that  awaited  their  emancipation.     They  suffered  for  what?     For 
the  cause,  for  social  rights,  for  freedom,  for  commercial  values,  not 
only  on  their  own  account,  but  on  that  of  their  brethren,  of  the 
church,  of  society.     As  the  patriot  dies  for  his  country,  so  the 
Christian  martyr  gives  himself  up  for  the  Christian  commonwealth, 
both  of  which  sacrifices  are  made  for  the  future  good  of  the  socie- 
ties for  which  they  shed  their  blood.     If  it  be  said,  that  the  Chris- 
tian martyr  dies  for  his  faith,  because  he  will  not  renounce  his  Lord      I 
and  Master,  it  is  true.     But  this  condition  is  imposed  merely  as  a 
pretext  for  a  deprivation  of  commercial  rights.     It  was  not  for  the 
mere  love  of  cruelty  and  death,  that  Christian  martyrs  have  been 
sacrificed  ;  but  it  was  for  commercial  benefits  which  their  execu- 
tioners hoped  to  obtain,  directly  or  indirectly.    Commercial  vahies 
have  always  been  at  the  foundation,  and  constituted  the  cause,  of 
such  murderous  despotism.    What  immense  confiscations  of  prop- 
erty, and  how  many  other  commercial  advantages,  have  been  gained 
by  tyrants,  in  the  persecution  of  Christians !     It  may  be  that  this 


124  DEFINITION    OF    FREEDOM. 

eqd  has  not  always  been  obtained ;  but  that  such  were  the  aims, 
there  can  be  no  more  doubt,  than  of  the  fact.  Other  motives  may 
have  been,  were  of  course,  assigned.  There  is  nothing  more  hypo- 
critical and  false  than  injustice.  The  strength  of  despotism  always 
lies  in  commercial  values  ;  and  the  object  of  tyrants  is  to  fortify 
their  power  by  an  accumulation  of  such  means.  They  do  not  prac- 
tise injustice  and  oppression  wantonly,  though  they  may  show  mal- 
ice, and  display  the  most  diabolical  passions,  in  the  execution  of 
vengeance  on  those  who  stand  in  their  path,  or  who  refuse  to  yield 
to  their  claims.  All  the  vices  inherent  in  the  nature  of  man,  or  of 
which  he  is  susceptible  by  temptation,  and  all  the  worst  passions 
that  ever  urged  him  on  to  crime,  have  not  unlikely,  have  doubtless, 
mixed  themselves  up  with  diese  atrocities.  There  is  a  natural 
affinity  between  vice,  and  crime,  and  murder,  in  all  the  forms  of 
each.  They  are  all  parts  of  the  same  character,  constituting  only 
different  stages  of  progress  in  one  career.  But  it  is  only  by  the 
acquisition  and  perverted  use  of  commercial  values,  that  depraved 
passions  are  gratified.  These  are  the  means  of  their  sustenance, 
the  elements  on  which  they  feed.  The  atrocities  and  inhumanities 
that  were  practised  on  Christians,  in  the  early  ages,  under  the  pre- 
text of  purging  society  of  bad  members,  would  never  have  stained 
the  pages  of  history,  but  for  the  commercial  advantages  that  were 
expected  from  them,  and  too  often  realized.  Even  under  the  mis- 
takes that  were  made,  in  this  particular,  as  proved  by  the  apologists 
of  Christians  to  the  Roman  emperors,  the  very  argument  shows  that 
the  object  of  those  persecutions  was  commercial  benefit. 

In  the  same  manner,  when  the  church  herself  became  corrupt, 
and  turned  persecutor,  her  inquisition,  her  dungeons,  her  racks,  her 
auto-de-fes  —  all  her  instruments  for  the  punishment  of  heresy,  in- 
volving the  use  of  physical  power — were  for  the  defence  and  for 
the  acquisition  of  commercial  values,  and  by  means  of  them.  This 
was  the  power  employed,  and  it  was  employed  to  strengthen  and 
fortify  itself,  by  depriving  its  victims  of  the  possession  and  enjoy- 
ment of  these  rights.  Like  all  false  pretexts,  the  defence  and  propa- 
gation of  the  true  faith  was  the  alleged  motive  ;  the  real  aim  was 
that  power  which  is  founded  on  conmiercialvalues.  "Life,  liberty, 
and  the  pursuit  of  hajipiness,"  in  one's  own  chosen  way,  are  them- 
selves commercial  values  and  commercial  rights.  The  church,  as 
a  persecutor,  was  not  content  with  taking  these,  but  the  goods  of 
heretics,  before  acquired,  were  first  forfeited. 

Despotism,  in  whatever  form,  when  analyzed,  will  be  found  to 


DEFINITION    OF    FREEDOM.  125 

aim  at  these  objects,  and  only  at  these,  as  a  power  to  maintain  its 
authority  and  sway,  inasmuch  as  nothing  else  will  answer  its  pur- 
poses. As  a  consequence,  it  will  follow,  that  freedom  consists  in 
keeping  all  commercial  values  in  the  hands  and  under  the  control  of 
those  to  whom  they  rightfully  belong. 

The  truth  of  a  principle,  and  the  perfection  of  a  definition, 
are  alike  demonstrated  by  their  application  to  all  conditions  and 
phases  of  the  subject.  Herein  is  proved  the  truth  of  the  prin- 
ciple which  lies  at  the  foundation  of  the  argument  of  this  chapter. 
It  is  not  denied,  that  there  are  various  attributes  of  freedom, 
passing  under  denominations,  which  do  not  direcdy  suggest  this 
principle,  and  which  may  even  apparently  lead  to  the  conclusion, 
that  freedom  consists  in  something  else ;  but  it  will  be  found 
that  this  something  else,  in  all  its  parts  and  ramifications,  is  redu- 
cible to  this  basis,  and  rests  upon  it.  A  people  never  did,  and 
never  would  complain  of  despotism,  and  a  political  revolution  can 
not  be  found  in  all  history,  except  for  an  unjust  deprivation  of  com- 
mercial rights.  There  are,  indeed,  numerous  other  forms,  in  which, 
as  results,  despotism  is  made  manifest ;  and  these  are  not  unnatu- 
rally taken  as  the  fundamental  evils,  whereas  they  are  only  conse- 
quences. The  first  abatements  of  an  absolute  despotism,  such  as 
may  be  found  in  history,  and  which  has  extended  to  power  over  life, 
without  responsibility,  have  been  the  lopping  off  of  its  branches ; 
and  the  reformation  has  gradually  continued,  till,  in  modern  times, 
both  in  Europe  and  America  —  especially,  as  we  think,  in  the  lat- 
ter—  an  approximation  has  been  made  to  tli€  root  of  the  difficulty, 
to  the  very  foundation.  Scarcely  in  any  part  of  the  civilized  world, 
are  men  now  familiar  with  the  cutting  off  of  heads,  at  the  arbitrary 
nod  of  a  despot.  Constitutional  governments,  and  laws  enacted  by 
Shem,  prevail  extensively,  and  are  constantly  gaining  ground.  In 
die  United  States,  in  Great  Britain,  in  France,  and  in  other  parts 
of  Europe,  the  cause  of  freedom  has  made  such  progress,  that  the 
care  of  men  is  not  for  their  heads,  but  for  their  purses,  for  their 
commercial  values  ;  and  what  now  remains,  in  some  of  these  coun- 
tries, is  a  proper  adjustment  of  a  system  of  taxation,  and  a  security 
of  the  chances  of  commercial  acquisitions.  This  is  the  great  ques- 
tion of  the  age,  and  demonstrates,  that  it  is  tJie  last,  as  well  as  the 
fundamental  question,  in  the  progress  of  freedom.  The  inequali- 
ties in  the  burdens  of  society,  as  they  bear  on  commercial  rights, 
are  yet  vast,  and  vastly  complicated  ;  and  they  are  too  often  vastlj 
greater  than  thej  ought  to  be — than  is  consistent  with  freedom. 


( 


126  WHAT    CAUSED    THE    AMERICAN    REVJLUTIO.V. 


CHAPTER    VIII. 

WHAT  CAUSED  THE  AMERICAN   REVOI.UTION. HISTORY  OF  THE 

PilOTECTIVE     POLICY    IN    THE    UNITED    STATES. 

A  Restatement  of  the  Object  of  ihis  Worlt,.and  of  the  great  Error  of  the  Economists. — The 
Theme  of  this  Chapter  important  as  a  Startinc;  Point  in  the  General  Argument — The 
Instinctive  Po  ky  i)f  a  Purenl  Stale  toward  Remoto  Dependencies,  fatal  to  the  End  in 
"View. — Such  was  the  Policy  of  Great  Britain  towarl  her  North  American  Colonies. — A 
Heview  of  that  Policy. — The  Doctrines  of  Jo&hua  Gee. — Their  Influence  on  Parliament 
and  the  Board  of  Trade. — Acts  of  Opposition  and  Wrong  Provoked  the  Revolution. — 
Declaration  of  Independence  — Commercial  Values,  as  the  Fruits  of  Labor,  the  Occasiott 
of  the  Contest — The  Position  of  the  FreeTiade  Economists  as  to  the  Elements  of  this 
Controver.Ky. — They  were  forced  to  jostrfy  Wrong. — The  Wrong  a  Commercial  one. — 
The  Aim  of  the  MevoluJion  was  to  break  down  the  Old,  and  to  e.stabli.sh  a  New  System 
of  Public  Economy,  that  is,  a  Protective  Sy.stem  — The  Struggle  was  based  on  the  Prin- 
ciple of  Mine  and  Thine,  as  it  determines  Commercial  Riglus. — A  Protective  System  of 
Society  the  great  Object  in  this  Country  from  the  Frr.st. — The  great  Movement  frona 
Europe  to  America  was  and  is  for  this. — The  Confederation  a  Rope  of  Sand. — A  Pro- 
tective System  the  great  Object  of  the  Federal  Constitution. — One  of  the  first  Acts  of 
the  new  Congress  v/as  to  establish  a  Protective  System — Documentary  Evidence  for 
Fifty  Years,  that  Protection  was  llie  Uniform  Policy  of  tlie  Country. — The  Cause  of 
Apostacy  from  this  Ancient  Faith. 

We  wish  it  to  be  observed,  throughout  this  work,  that  we  are 
writing  on  public  economy  for  the  United  States,  and  not  for  the 
family  of  nations,  nor  for  any  other  nation.  We  have,  in  the  fore- 
going pages,  particularly  in  the  second  chapter,  distinctly  and  em- 
phatically repudiated  the  idea,  that  it  is  possible  to  adapt  a  system 
of  public  economy  to  all  nations,  or  even  to  any  two,  and  we  have 
endeavored  to  show,  that  the  errors  of  Free-Trade  economists  have 
necessarily  been  fatal,  by  attempting  to  form  a  general  system. 
By  over-grasping  ambition,  or  some  other  kindred  propensity,  in 
I  putting  their  screws  on  all  the  world,  they  have  broken  their  ma- 
\  chinery,  and  done  injury  to  the  subject ;  in  essaying  to  do  too 
much,  they  have  spoiled  the  whole.  Had  they  been  content  to 
study  and  lay  down  rules  for  their  respective  commonwealths,  they 
would  have  found  enough  to  do,  and  might  have  done  it  well ;  but, 
in  reaching  out  their  arms,  to  take  in  all  the  world,  they  seem  to 
us  to  have  fallen  into  the  sea,  for  lack  of  ability  for  so  great  an 
enterprise ;  or  rather,  to  have  failed,  because  it  was  impossible  in 
the  nature  of  the  subject,  and  in  the  nature  of  things,  to  execute 
such  a  plan.  Though  there  are  common  principles,  there  can  not 
be  a  common  system,  in  its  great,  essential,  and  most  important 


^  WI^\T    CAUSED    THE    AMERICAN    REVOLUTION.  127 

parts;  ana  the  parts  which  can  not  be  made  common,  are  those 
which  are  most  vital  to  each  of  the  great  parties  concerned.  ^ 

A  more  minute  review  of  the  occasion  of  the  American  revolu-  ^"'^-^"^■^^ 
tion,  and  of  the  aims  of  American  independence,  which  are  neces-  /^*"^t_-^_ 
sarily  and  frequently  alluded  to,  in  the  progress  of  this  work,  and  ^y'^i'^Sf!*^ 
which  have  been  somewhat  dwelt  upon  already,  is  fundamental  J^  .y 
to  the  great  inquiry  in  which  we  are  engaged,  and  will  cast  more  v^^ 

light  on  the  general  subject,  than  any  other  things  in  history,  to 
which  we  could  direct  our  attention,  as  starting  points. 

It  is  hardly  necessary  to  say,  that  the  occasion  of  the  American 
revolution,  was  a  denial  and  deprivation  of  rights,  and  the  impo- 
sition and  infliction  of  wrongs.  It  seems  to  be  a  natural,  if  not  a 
necessary  policy  of  a  home  government,  to  increase  the  dependence 
of  remote  and  colonial  branches  of  itself,  in  proportion  to  the  in- 
crease of  their  importance,  and  of  their  ability  to  gain  independence; 
and  in  that  way  uldmately  to  precipitate  the  event  apprehended. 
It  was  soon  discovered  by  British  statesmen,  that  their  American 
colonies  had  all  the  elements  of  gigantic  power,  and  that  to  be  re- 
tained, they  must  be  ruled  with  a  discipline  corresponding  with  the 
danger  of  losing  them.  Accordingly,  this  policy  is  found  to  date 
back  to  the  earliest  history  of  the  colonies,  and  consisted  chiefly  in  ' 

the  plan  to  confine  the  colonists  to  agriculture-^ to  the  production 
of  raw  materials — to  prohibit  them  from  engaging  in  commerce, 
and  to  force  them  to  purchase  of  the  mother-country  such  articles 
of  manufacture  and  of  the  mechanic  arts  as  they  might  want. 
Joshua  Gee  seems  to  have  been  one  of  the  oracles  most  relied  upon 
for  political  doctrines,  in  the  treatment  of  the  American  colonies, 
of  which  the  following  extracts  from  him  are  specimens:  "That 
manufactures  in  American  colonies  should  be  discouraged  or  pro- 
hibited."— "  We  ought  always  to  keep  a  watchful  eye  over  our 
colonies,  to  restrain  them  from  setting  up  any  of  the  manufactures 
that  are  carried  on  in  Great  Britain  ;  and  any  such  attempts  should 
be  crushed  in  the  beginnin:;.  For  if  they  are  suffered  to  grow  up 
to  maturity,  it  will  be  difficult  to  suppress  them.  Our  colonies  are 
much  in  the  same  stale  Ireland  was  in,  when  they  began  the  woollen 
manufactory  ;  and  as  their  numbers  increase,  will  foil  upon  man- 
ufactures for  clothing  themselves,  if  due  care  be  not  taken." — "If 
we  examine  into  the  circumstances  of  the  inhabitants  of  our  plan- 
tations, and  our  own,  it  will  appear,  that  not  one  fourth  part  of  their 
own  products  redounds  to  their  own  profit ;  for  out  of  all  that 
comes  here,  they  only  carry  back  clothing,  and  other  accommoda- 


128  WHAT    CAUSED    THE    AMERICAN    REVOLU.'ON. 

tions  for  their  families,  all  of  which  is  of  the  merchandise  and  man- 
ufacture of  this  kingdom." — "  New  England,  and  the  northern 
colonies  have  not  commodities  and  products  enough  to  send  us  in 
return  for  purchasing  their  necessary  clothing,  but  are  under  very- 
great  difficulties ;  and  therefore  any  ordinary  sort  sells  with  them. 
And  when  they  have  grown  out  of  fashion  with  us,  they  are  new- 
fashioned  enough  there." 

This  corresponds  with  the  following  facts  collected  from  Pitkin's 
Statistical  View  :  In  1 099,  the  British  parliament  prohibited  the 
colonies  from  exporting  wool,  yarn,  or  woollen  fabrics,  and  from 
carrying  them  coastwise  from  one  colony  or  place  to  another.  In 
1719,  parliament  declared,  that  the  erection  of  manufactories  in  the 
colonies,  tended  to  lessen  their  dependence  on  the  mother-country. 
This  declaration,  and  subsequent  legislation  on  the  subject,  were 
in  consequence  of  memorials  from  British  merchants  and  man- 
ufacturers, who  complained  that  the  colonies  were  cariying  on 
trade,  and  erecting  manufactories.  The  subject  continued  to  be 
agitated,  and,  in  1731,  the  board  of  trade  were  instructed  to  inquire 
as  to  the  colonial  laws  made  to  encourage  manufactures;  as  to 
manufactures  set  up  ;  and  as  to  the  trade  carried  on  in  the  colonies; 
and  to  report  thereon.  Accordingly,  in  1732,  the  board  reported, 
that  Massachusetts  had  passed  a  law  to  encourage  manufactures; 
that  the  people  of  New  York,  Connecticut,  Rhode  Island,  and 
Maryland,  had  fallen  into  the  manufacture  of  woollen  and  linen  for 
the  use  of  tlieir  own  families  ;  and  of  flax  and  hemp  in  coarse  bags 
and  halters  —  all  which,  they  said,  interfered  with  the  rights  and 
profits  of  British  manufacturers  and  merchants.  The  board  of  trade, 
therefore,  recommended,  that  the  minds  of  the  people  of  those 
colonies  should  be  immediately  diverted,  and  a  stop  be  put  to  these 
practices,  or  they  would  be  extended.  The  same  year  parliament 
prohibited  the  exportation  of  hats  from  the  colonies,  and  tra- 
ding in  them  from  one  colony  to  another,  by  ships,  carts,  or  horses. 
No  hatter  was  allowed  to  set  up  business,  who  had  not  served  seven 
years;  nor  to  have  more  than  two  apprentices;  and  no  black  person 
w^as  allowed  to  work  at  the  trade.  Iron  mills  for  slitting  and  roll- 
ing, and  plating-forges,  were  prohibited,  under  a  penalty  of  five 
hundred  pounds.  This  system  of  prohibition  and  restriction  con- 
tinued to  increase,  against  both  manufactures  and  commerce,  and 
in  proportion  as  the  people  manifested  a  disposition  to  supply  their 
own  wants,  new  and  more  vexatious  modes  were  invented,  and  ap- 
plied with  increased  rigor,  and  under  heavier  penalties,  to  prevent 


WHAT    CAUSED    THE    AMERICAN    REVOLUTION.  129 

them,  till  finally,  as  the  colonies  waxed  great  and  strong,  and  serious 
appreliensions  began  to  be  felt  that  they  would  outgrow  the  ability 
of  the  mother-country  to  keep  them  in  subjection,  the  right  of  tax- 
ation to  furnish  the  means  of  maintaining  this  power  over  them,  was 
asserted,  without  allowing  the  correlative  right  of  representation. 
Hence  the  rising  of  the  people,  and  the  declaration  of  independence 
which  was  followed,  after  a  seven  years'  war,  with  its  acknowledg- 
ment. During  the  debates  in  parliament,  on  the  rights  of  the 
colonies,  Lord  Chatham  said,  "  he  would  not  have  the  Americans 
make  a  hob-nail."  Another  noble  lord  added,  "  nor  a  razor  to 
shave  their  beards." 

By  these  and  similar  facts,  with  which  the  history  of  that  period 
abounds,  it  is  easy  to  see  what  was  the  occasion  of  the  American 
revolution.  It  will,  perhaps,  be  more  fully  illustrated  by  the  fol- 
lowing extracts  from  the  Declaration  of  Independence: — 

"  He  [the  king]  has  refused  his  assent  to  laws  the  most  whole- 
some and  necessary  for  the  public  good"  [particularly  laws  for  the 
encouragement  of  home  manufactures,  etc.]  ;  .  .  "  he  has  refused 
to  pass  other  laws,  unless  the  people  would  relinquish  the  right  of 
representation  ;  he  has  dissolved  representative  houses,  repeatedly, 
for  opposing,  with  manly  firmness,  his  invasions  on  the  rights  of 
the  people ;"  .  .  "  he  has  endeavored  to  prevent  the  population 
of  these  states;"  .  .  "he  has  made  judges  dependent  on  his 
will;"  .  .  "he  has  erected  a  multitude  of  new  offices,  and  sent 
hither  swarms  of  officers,  to  harass  our  people,  and  eat  out  their 
substance  ;  he  has  kept  among  us,  in  times  of  peace,  standing 
armies,  without  the  consent  of  our  legislatures;  he  has  afTected  to 
render  the  military  independent  of,  and  superior  to,  the  civil 
power ;"  .  .  "he  has  cut  off  our  trade  with  all  parts  of  the  world ; 
he  has  imposed  taxes  on  us,  without  our  consent ;"  etc.  .  . "  In 
every  stage  of  these  oppressions,  we  have  petitioned  for  re(h'ess, 
in  the  most  humble  terms.  Our  repeated  petitions  have  been 
answered  only  by  repeated  injury  ;"  etc. 

As  all  rights,  in  a  system  of  civil  polity,  established  on  a  |)olit- 
cal  platform,  which  are  of  importance  to  claim,  are  of  a  com- 
mercial nature,  positively  or  constructively,  directly  or  imlirectly, 
as  shown  in  the  preceding  chapter;  that  is,  the  right  to  he  oxw  own, 
to  have  our  own,  and  to  use  our  own,  without  abatement,  re-traint, 
or  control,  except  by  laws  equally  important  to  all  the  menibers  of 
the  commonwealth,  in  which  all  have  a  voice  ;  it  will  follow,  from  a 
consideration  of  the  subjects  of  grievance,  as  above  briefly  and  coin- 

9 


130  WHAT    CAUSED    THE    AMERICAN    REVOLUTION. 

prehensively  represented,  which  led  to  the  independence  of  these 
United  States,  that  they  were  all  of  a  commercial  character,  and 
had  respect  to  the  rights  of  property  which  every  man  has  in  him- 
self, and  to  the  avails  of  his  own  exertions  in  a  state  of  freedom, 
bating  only  his  fair  tax  to  the  public,  in  which,  also,  he  is  entitled 
to  a  voice.  It  is  not  pretended  that  there  are  no  other  rights  ;  but 
that  all  others  follow.  The  security  of  all  commercial  rights, 
is  a  security  of  all  others,  which  men,  in  their  relations  to  each 
other,  on  the  platform  of  a  free  commonwealth,  are  likely  to  claim. 

It  should  not  be  forgotten,  then,  as  it  is  an  important  point,  that 
the  rights  which  the  American  fathers  asserted  in  opposition  to 
tyranny,  and  which  they  vindicated  with  their  fortunes  and  their 
blood,  were  of  a  commercial  nature.  As  elements  of  a  civil  polity, 
they  are  also  political  rights.  And  this,  too,  is  an  important  con- 
sideration. Labor  was  the  vital  ingredient;  and  the  shield  thrown 
over  it  by  the  success  of  the  revolution,  rescued  it  from  its  former 
exposed  condition.  It  was  a  political  instrument,  a  structure,  an 
edifice,  that  rose  out  of  that  struggle,  to  secure,  what  strife  and 
blood  had  vindicated,  viz.,  the  rights  of  labor,  which  thus  became 
—  or  rather  were  thus  demonstrated  to  be  —  political  rights;  and 
which  were  thus  reinstated  in  their  true  position.  The  aim  of  the 
British  crown  was  to  draw  to  itself  the  fruits  of  American  labor ;  it 
wanted  nothina;  else.  The  aim  of  the  American  fathers  was  to 
retain  those  fruits  in  their  own  possession,  as  their  own  right ;  and 
this  was  the  occasion  of  the  struggle. 

It  is  manifest  enough,  now  that  these  rights  are  seen  to  be  of  a 
commercial  nature,  that  they  fall  within  the  range  of  public  econ- 
omy. And  they  are  not  only  of  a  commercial  nature,  as  well  as 
social  and  political,  but  it  will  be  seen,  that  they  are  radical  sources 
and  fundamental  causes  of  commercial  prosperity.  These  rights 
have  been  entirely  overlooked  by  European  economists,  and  others 
on  this  side  of  the  Atlantic,  who  have  been  servile  and  weak  enough 
to  borrow  their  opinions,  and  to  adopt  systems  made  to  their  hands. 
In  overlooking  this  element,  it  was  impossible  to  build  up  a  system 
of  public  economy,  that  would  not  be  erroneous.  This  element, 
in  such  a  system,  would  necessarily  be  wanting  as  an  anchor  to  the 
ship,  while  at  rest;  and  it  would  be  wanting  also,  when  most 
needed,  as  a  compass,  and  as  a  fixed  celestial  sign,  while  on  a 
voyage  over  the  trackless  deep  of  inquiry  on  the  subject.  All 
human  society,  as  shown  in  another  chapter,  is  built  up  by  labor, 
and  moored  to  its  hand.     The  better,  therefore,  the  condition,  and 


WHAT    CAUSED    THE    AMERICAN    REVOLUTION.  131 

the  more  healthful  the  cause,  so  much  better  and  more  vigorous 
the  product. 

But,  from  a  sickly  parent,  a  promising  offspring  has  been 
pledged ;  from  a  degraded  and  servile  operator,  the  finest  speci- 
mens of  human  ingenuity  and  art,  are  alleged  to  come ;  and  from 
an  oppressed  and  manacled  agent,  it  is  proposed  to  erect  the  most 
worthy  monuments  of  human  greatness!  Such  as  these  are  the 
fundamental  elements  of  the  systems  of  the  leading  Free-Trade 
economists.  They  have  rejected  the  sound,  and  adopted  and 
cherished  the  rotten. 

As  the  rights  of  labor  ever  have  been,  so  will  they  ever  remain, 
in  accordance  with  the  beneficent  orders  of  the  Creator,  the  truest 
sources,  and  the  most  exact  exponents  of  public  and  private  wealth. 
There  may  doubtless  be  unnatural  accumulations  of  wealth,  by  the 
suppression  of  these  rights  ;  but  it  can  not  be  so  great  in  the  aggre- 
gate ;  and  the  misfortune  of  beginning  wrong,  is  always  to  end 
wrong,  as  well  as  to  be  in  peril  on  the  way.  Everything  built  on 
the  sacrifice  of  these  rights,  topples  on  its  foundation,  and  will  fall 
at  last.  There  is  no  true  economy  in  such  a  policy,  either  at  the 
beginning,  or  at  any  stage  thereof,  or  at  the  end ;  nor  can  any 
human  ingenuity  make  an  argument  on  that  side,  that  will  bear 
scrutiny.  It  is,  perhaps,  because  of  this  radical,  fundamental  de- 
fect, that  we  find  so  many  contradictions  and  absurdities  in  the  Eu- 
ropean economists — we  mean  those  of  the  Free-Trade  school. 
Each  of  them,  especially  Adam  Smith,  has  abstract  propositions 
enough  to  build  up  any  system  ;  plenty  for  an  American  system, 
and  all  right ;  but  when  he  comes  to  put  the  parts  of  his  system 
together,  the  faults  of  the  whole  are  apparent.  It  was  necessary  in 
their  case,  having  a  vicious  state  of  society  for  a  foundation,  to 
justify  the  greatest  wrongs  done  to  man,  and  to  show  how  profit 
to  the  race,  to  nations,  could  come  out  of  such  treatment. 

American  independence  established  an  American  system  of 
public  economy.  If  it  did  not,  independence  must  necessarily 
have  been  a  total  failure.  The  declaration  was  based  on  the  prin- 
ciple, "To  THE  Rescue."  Rescue  from  what?  From  injus- 
tice, oppression,  tyranny.  And  in  what  did  the  injustice,  the  op- 
pression, the  tyranny,  complained  of,  consist  ?  The  British  crown, 
as  shown  above,  undertook  to  draw  all  the  fruits  or  profit  of  Amer- 
ican labor  to  itself,  in  the  same  manner  as  European  governments, 
for  the  most  part,  still  absorb  the  profits  of  European  labor.  The 
wrong  was  not  only  political,  social,  and  moral,  but  commercial 


132  WHAT    CAUSED    THE    AMEUICAN    REVOLUTION. 

and  it  was  all  three  of  the  former  only  as  and  because  it  was  espe- 
cially the  latter.  All  the  substance  of  the  wrong  was  of  a  com- 
mercial nature.  It  receives  these  other  denominations  or  epithets, 
merely  to  describe  its  character  in  a  social  point  of  view.  They 
are  no  description  of  the  substance.  The  point  and  essence  of  the 
wrong  consisted  in  the  fact,  that  one  party  took  away  the  property 
of  oiher  parties,  which  was  the  right  of  the  latter,  because  they  had 
created  it  by  their  own  exertions,  and  because  it  was  necessary  to 
their  comfort  and  happiness.  And  it  was  a  wrong,  which  not  only 
made  the  suffering  parties  poor,  but  which  took  away  their  chances 
of  growing  rich  —  even  of  bettering  their  condition.  It  was  a  sys- 
tem of  economy  well  enough  calculated  to  promote  the  wealth  and 
augment  the  power  of  Great  Britain  at  home ;  but  it  was  the  ruin 
of  the  American  colonies.  At  best,  it  was  a  vast  injury  to  them, 
and  an  insuperable  obstacle  to  their  greatest  possible  prosperity. 
The  object  of  the  revolution  was  to  change  the  system  —  to  change 
it  entirely,  fundamentally  —  to  secure  to  the  people  the  benefits  of 
the  right  of  property  in  themselves.  When  a  man  is  forced  to 
work  for  the  benefit  of  others,  it  is  a  mockery  to  say  he  is  his  own 
man.  Such  was  the  condition  of  the  colonists  before  the  revolution. 
They  were  forced  to  work  for  the  benefit  of  foreigners.  As  Joshua 
Gee  says,  in  the  extract  above  made,  "  if  we  examine  into  the  cir- 
cumstances of  the  inhabitants  of  our  plantations,  and  our  own,  it 
will  appear,  that  not  one  fourth  ^w  rt  o^  i\^Q\T  own  products  redounds 
to  their  own  profit;"  and  the  professed  object  of  his  plan,  which 
was  adopted  and  acted  upon,  by  the  British  government,  was  to 
perpetuate  this  system.  The  American  fathers  went  into  the 
struggle  against  the  British  crown,  to  break  it  up.  They  went  for 
a  rescue,  and  to  establish  an  order  of  things  that  should  secure  to 
them  their  own  commercial  rights,  and  retain  among  themselves  the 
fruits  of  their  own  industry  and  enterprise.  They  went  for  a  sys- 
tem to  encourage  home  manufactures,  which  had  been  forbidden  ; 
to  leave  every  man  free  to  follow  his  own  chosen  pursuit,  make 
hats  or  anything  else,  and  to  secure  to  him  the  enjoyment  of  his 
own  earnings  —  of  that  cumulative  wealth  which  always  results 
from  systematic  industry,  when  not  absorbed  by  oppressors.  The 
change  which  they  sought  for  and  effected,  was  a  revolution  in 
public  economy,  and  these  two  words  comprehend  the  whole. 
The  nominal  change  from  the  relations  of  a  colony,  to  the  position 
of  an  independent  state,  was  of  no  consequence  without  this  ;  and 
if  the  British  crown  had  granted  this,  or  never  taken  it  away,  the 


WHAT    CAUSED    THE    AMERICAN    REVOLUTION.  133 

American  fathers  would  never  have  desired  a  separation.  There 
would  have  been  no  motive  —  no  object.  It  was  purely  and 
exclusively  to  establish  a  new  and  American  system  of  public 
economy. 

Most  people  are  accustomed  to  think,  that  all  rights  passing 
under  the  denomination  of  political,  are  certain  abstractions  sup- 
posed to  be  of  importance,  though  perhaps  undefinable.  They 
may  be  tried  by  following  out  the  inquiry  carefully  —  in  what  does 
their  importance  consist?  Take  for  example,  the  rights  claimed 
of  the  British  crown  by  the  American  fathers,  and  the  correlative 
wrongs.  It  will  be  found  that  every  one  of  them  was  of  a  com- 
mercial character,  and  exclusively  so.  When  scrutinized,  they 
resolve  themselves  into  meum-et-tuum^  mine-and-thine  questions, 
involving  valuable  commercial  considerations.  Nor  can  it  be  al- 
leged, that  they  are,  on  that  account,  more  sordid,  or  less  worthy 
of  respect,  than  has  commonly  been  supposed.  For  after  all,  the 
principle  of  mine  and  ihine  is  the  nicest  and  the  most  important 
rule  of  society  ;  it  is  the  ground  of  all  controversy  ;  the  end  of  all 
debate  ;  the  cause  of  all  wars ;  and  the  authority  that  establishes 
peace  and  quietness.  It  may  excite  to  action  the  purest  and  most 
ennobling  virtues  ;  or  it  may  rouse  the  fiercest  and  most  destruc- 
tive passions.  Armies  and  navies  may  rush  to  combat  by  its 
instigations ;  thrones  may  be  shaken  and  nations  revolutionized 
by  its  power.  It  is  not,  therefore,  of  course  and  in  itself,  a 
mean  consideration,  though  in  the  controversy  between  the  Amer- 
ican fathers  and  the  British  crown,  it  was  purely  a  commercial 
one.  It  was  important  to  have  this  point  distinctly  settled  and 
properly  elucidated,  that  every  one  may  see  clearly,  and  feel 
forcibly,  that  an  American  system  of  public  economy  must  ne- 
cessarily grow  out  of  it. 

The  history  of  the  protective  policy  in  the  United  States,  will  be 
found,  as  we  think,  to  comprise  the  essence  of  all  that  is  peculiar 
and  distinctive  in  the  political  history  of  this  country,  from  its  foun- 
dation to  the  present  time,  running  back  through  our  colonial  his- 
tory—  not,  indeed,  as  a  thing  that  was  through  all  this  period,  but 
as  an  object  for  ever  aimed  at  and  contended  for,  as  vital  to  all  the 
great  and  minor  interests  of  the  country  and  of  the  people.  It  may 
be  said  to  have  been  the  grand  object  of  the  pouring  forth  of  Euro- 
pean emigrants  on  these  western  shores,  since  Columbus  announced 
their  existence  to  the  world.  It  was  a  sense  of  oppression,  of 
grievances,  oi  a  deprivation  of  rights,  which  produced  that  inqui- 


134  HISTORV    OF    THE    PROTECTIVE    POLICY" 

etude  in  Europe,  creating  a  wide-spread  willingness  and  desire  to 
sacrifice  native-born  comforts  and  innumerable  precious  ties,  for  "a 
lodge  in  some  vast  wilderness,"  remote  tbough  it  were,  but  beaming 
with  the  charms  of  distance  as  the  abode  of  freedom.  Though 
political  designs,  commercial  enterprise,  and  speculation,  had  their 
share  of  influence  in  the  settlement  of  this  continent,  it  is  unneces- 
sary to  say,  that  the  ruling  passion  of  European  emigration  this 
way,  for  ages,  was  an  indomitable  aspiration  after  freedom — a  free- 
dom which  could  not  be  enjoyed  in  the  old  world  ;  and  it  is  equally 
true,  as  all  know,  that  the  same  feelings  still  continue  to  prompt 
this  great  movement  from  East  to  West.  Westward  the  star  of 
empire  moves  ;  but  it  is  all  for  freedom.  It  is  to  purchase,  to  se- 
cure, and  to  protect  the  rights  of  man — the  very  rights  which  have 
been  under  consideration  in  the  preceding  chapter.  It  is  to  be  re- 
lieved from  that  incubus  of  European  despotism,  which  robs  man 
of  the  reward  of  his  exertions,  and  to  enjoy  that  reward. 

But  unfortunately  for  freedom,  that  same  watchful  power,  the 
cruelties  of  which  had  forced  this  great  movement,  guided  and 
prompted  by  the  instincts  of  its  own  voracious  and  insatiable  appe- 
tite for  oppression  and  wrong,  followed  its  victims  in  the  pathway 
of  their  escape,  and  spread,  and  continued  to  hold,  over  them,  the 
claims  of  its  unjust  pretensions.  It  is  enough  for  our  purpose  here, 
to  abridge  this  great  chapter  of  American  history,  and  point  only 
to  that  of  the  North  American  colonies,  till  it  ended  in  the  estab- 
lishment of  American  independence.  The  whole  of  that  history  wa& 
a  struggle  for  freedom,  without  gaining  it;  for  it  will  be  found,  that 
the  commercial  troubles  of  tlie  confederated  states,  till  the  adoption 
of  the  constitution  in  1789,  were  greater  than  they  had  ever  been, 
and  that  the  independence  acquired  was  merely  nominal  —  all  and 
solely  for  want  of  a  protective  system,  which,  under  such  a  rope 
of  sand  as  the  articles  of  confederation,  could  not  be  put  in  force. 
The  evils  of  this  specific  character — there  were  no  other — were 
seen,  felt,  and  deplored  ;  the  states,  in  their  isolated  positions,  tried 
to  protect  themselves,  and  only  made  the  matter  worse,  aggravated 
the  difficulties,  by  interferences  ;  till  at  last,  the  states  being  on  the 
verge  of  dissolution,  as  an  independent  nation,  on  account  of  this 
great  defect,  the  federal  constitution  was  adopted  as  a  remedy. 
The  history  of  those  times  shows,  that  the  grand  object,  the  impel- 
ling necessity,  of  the  formation  of  the  federal  government,  in  1789, 
was  to  obtain  a  power  for  the  protection  of  the  commercial  rights 
of  the  nation  and  of  the  people ;  and  in  accordance  with  this  de- 


IN    THE    UNITED    STATES.  135 

sign,  the  earliest  action  of  the  new  government,  was  on  the  question 
of  forming  and  estabUshing  a  protective  system.  The  bill,  or  act, 
which  was  the  great  object  of  the  federal  constitution,  on  motion 
of  Mr.  Madison,  the  father  of  that  instrument,  was  brought  for- 
ward, with  the  least  possible  delay,  under  the  following  preamble: 
*'  Whereas,  it  is  necessary  for  the  support  of  government,  for  the 
discharge  of  the  debts  of  the  United  States,  andyor  the  encourage- 
ment and  PROTECTION  of  manvfacturcs,  that  duties  be  laid  on  goods, 
wares,  and  merchandise,  inqiorted — Be  it  enacted,"  &c.;  and  after 
having  been  passed,  was  signed  by  President  Washington,  the 
Fourth  of  July,  17S9  —  a  signal  coincidence,  as  being  the  birth- 
day of  American  freedom,  not  an  accident,  manifesUy,  but  ex- 
pressly designed,  no  doubt,  as  a  profound  and  emphatic  historical 
expression  of  the  president's  and  of  the  public  sense  of  the  affinity 
and  identical  purpose  of  these  two  great  events,  and  that  the  first 
could  not  be  complete,  nor  consummated,  without  the  second. 
The  same  necessity  which  begat  the  revolution,  was  the  parent  of 
the  federal  constitution,  and  of  this  law — this  law,  or  its  policy, 
established  and  secured,  being  the  end  of  all. 

A  few  extracts  from  presidential  messages  and  other  documents, 
from  Washington's  administration  down  to  the  time  when  this  policy 
was  doomed  to  encounter  an  unnatural  and  suicidal  opposition,  will 
exhibit  the  prominency  which  this  great  principle  has  held  in  the 
counsels  and  legislation  of  the  government,  during  the  progress  of 
our  history.* 

•  From  Washington'' s  Messages  to  Congress. 
"  The  advancement  of  aijriculture,  commerce,  and  manufactures,  by  all  proper 
weans,  will  not,  I  tryst,  need  recommendation  ;  but  I  can  not  forbear  intimating  to 
you  the  expediency  of  givins  effectual  encourasement,  as  well  to  the  introduction 
of  new  and  useful  inventions  from  abroad,  as  to  the  exertions  of  skill  and  genius 
in  producing  them  at  home." 

"  Congress  has  repeatedly,  and  not  veithout  success,  directed  their  attention  to 
the  encouragement  of  manufactures.  The  object  is  of  too  much  consequence  not 
to  insure  a  continuance  of  their  efforts  in  every  way  which  shall  appear  eligible." 

From  Jefferson's  Messages. 
"To  cultivate  peace,  and  maintain  commerce  and  navigation,  in  all  their  lawful 
enterprises;  to  foster  our  fisheries,  as  nurseries  of  navigation  and  for  the  nurture 
of  man,  and  to  protect  the  manufactures  adapted  to  our  circumstances  —  these,  fel- 
low-citizens, are  the  landmarks  by  which  we  are  to  guide  ourselves  in  all  our  pro- 
ceedings."— Second  jlmiual  Message. 

"  The  situation  into  which  we  have  been  forced,  has  impelled  us  to  apply  a  por- 
tion of  our  industry  and  capital  to  national  manufactures  and  improvements.  The 
extent  of  conversion  is  daily  increasing,  and  little  doubt  remains,  that  the  estab- 
lishments formed  and  forming  will,  under  the  auspices  of  cheaper  materials  and 


136  HISTORY    OF    THE    PROTECTIVE    POLICY 

These  extracts,  in  the  note  below,  from  state-papers  and  other 
documents,  might  be  greatly  extended,  if  it  were  necessary,  to  show, 

subsistence,  the  freedom  of  labor  from  taxation  with  us,  and  of  protecting  duties 
and  ■prohibitions,  become  permanent." — Eighth  Jnnual  Message. 

From  JcJf'crson''s  Letter  to  Benjumin  Jlustin,  1816. 
"We  have  experienced  what  we  did  not  then  believe,  that  there  exist  both 
p-ofligacy  and  power  enoui^h  to  exclude  us  from  the  field  of  interchanges  with 
other  nations  ;  that  to  be  independent  for  the  comforts  of  life,  we  must  fabricate 
them  ourselves.  We  must  now  place  our  manufacturers  by  the  side  of  the  agricul- 
turist. The  former  question  is  now  suppressed,  or  rather  assumes  a  new  form. 
The  grand  inquiry  now  is,  shall  we  make  our  own  comforts,  or  go  without  them  at 
the  will  of  a  foreign  nation.  He,  therefore,  who  is  now  against  domestic  manufac- 
tures, must  be  for  reducing  us  either  to  a  dependence  upon  that  nation,  or  be  clothed 
in  skins,  and  live  like  beasts  in  dens  and  caverns.  I  am  proud  to  say,  that  I  am  not 
one  of  these.  Experience  has  taught  me,  that  manufactures  are  now  as  necessary  io 
our  independence  as  to  our  comfort." 

From  Madison's  Messages. 

"  The  revision  of  our  commercial  laws,  proper  to  adapt  them  to  the  arrangement 
which  hns  taken  place  with  Great  Britain,  will  doubtless  engage  the  early  atten- 
tion of  Congress.  It  will  be  worthy  at  the  same  time  of  their  just  and  provident 
care,  to  make  such  further  alterations  in  the  laws  as  will  more  especially  protect  and 
foster  the  several  branches  of  manufacture  which  have  been  recently  instituted  or 
extended  by  the  laudable  exertion  of  our  citizens." — 1809. 

"I  recommend  also,  as  a  more  effectual  safeguard,  and  as  an  encouragement  to 
our  growing  manufactures,  that  the  additional  duties  on  imports  which  are  to  ex- 
pire at  the  end  of  one  year  after  a  peace  with  Great  Britain,  be  prolonged  to  the 
end  of  two  years  after  that  event.'' — 18I4. 

"  But  there  is  no  subject  which  can  enter  with  greater  force  and  merit  into  the 
deliberations  of  Congress,  than  a  consideration  of  the  means  to  preserve  and  pro- 
mote the  manufactures  which  have  sprung  into  existence,  and  attained  unparalleled 
maturity  throughout  the  United  States  durin?  the  period  of  the  European  wars. 
This  source  of  national  independence  and  wealth  I  anxiously  recommend  to  the 
prompt  and  constant  guardianship  of  Congress." — 1815. 

"  In  adjusting  the  duties  on  imports  to  the  object  of  revenue,  the  influence  of  the 
tariff  on  manufactures  will  necessarily  present  itself  for  consideration.  However 
wise  the  theory  may  be,  which  leaves  to  the  sagacity  and  interest  of  individuals 
the  application  of  their  industry  and  resources,  there  are  in  this,  as  in  other  cases, 
exceptions  to  the  general  rule.  Besides  the  consideration  which  the  theory  itself 
implies  of  a  reciprocal  adoption  by  other  nations,  experience  teaches  that  so  many 
circumstances  must  occur  in  introducinu:  and  maturing  roanufacturin?  establish- 
ments, especially  of  a  more  complicated  kind,  that  a  country  may  remain  long  with- 
out them,  although  sufficienily  advanced,  and  in  some  respects  peculiarly  fitted  for 
carrying  them  on  with  success.  Under  circumstances  giving  a  powerful  impulse 
to  manufacturing  industry,  it  has  made  among  us  a  progress,  and  exhibited  an  effi- 
.  ciency,  which  justify  the  belief  that,  with  a  protection  not  more  than  is  due  to  the 
enterprising  citizens  whose  interests  are  now  at  stake,  it  will  become,  at  an  early 
day,  not  only  safe  against  occasional  competition  from  abroad,  but  a  source  of  do- 
mestic wealth  and  external  commerce.  In  selectin?  the  branches  more  especially 
entitled  to  public  patronage,  a  preference  is  obviously  claimed  by  such  as  will  re- 
lease the  United  States  from  a  dependence  on  foreign  supplies,  ever  subject  to 
casual  failures,  for  articles  necessary  for  the  public  defence,  or  connected  with  the 


IN    THE    UNITED    STATES.  137 

that  the  protective  policy  had  always  been  a  special  and  prominent 
object  of  the  government,  from  the  adoption  of  the  constitution  down 

primary  wants  of  individuals.  It  will  be  an  additional  recommendation  of  particu- 
lar manufactures,  where  the  materials  for  them  are  extensively  drawn  from  our 
agriculture,  and  consequently  impart  and  insure  to  that  great  fund  of  national 
prosperity  and  independence,  an  encouragement  which  can  not  fail  to  be  reward- 
ed."— Senenik  Annual  Message. 

From  Monroe's  Messages. 

"Our  manufactures  will  likewise  require  the  systematic  and  fostering  care  of 
the  government.  Possessing,  as  we  do,  all  the  raw  materials,  the  fruit  of  our  own 
soil,  and  industry,  we  ought  not  to  depend,  in  the  degree  we  have  done,  on  sup- 
plies from  other  countries.  While  we  are  thus  dependent,  the  sudden  event  of  war, 
unsought  and  unexpected,  can  not  fail  to  plun?':'  us  into  the  most  serious  difficul- 
ties. It  is  important,  too,  lluit  the  capital  which  nourishes  our  manufactures 
should  be  domestic,  as  its  influence  in  that  case,  instead  of  exhaustins',  as  it  must 
do  in  foreign  hands,  would  be  felt  advantageously  on  agriculture,  and  every  other 
branch  of  industry.  Equally  important  is  it  to  provide  at  home  a  market  for  our 
raw  materials;  as,  by  exiendin?  the  comi)etition,  it  will  enhance  the  price,  and 
protect  the  cultivator  against  the  casualties  incident  to  foreign  markets." — hiau- 
gural  Address. 

"Uniformity  in  the  demand  and  price  of  an  article,  is  highly  desirable  to  the 
domestic  manufacturer.  It  is  deemed  of  great  importance  to  give  encouragement 
to  our  domestic  manufactures." — Third  Annual  Message. 

"It  can  not  be  doubted,  that  the  more  complete  our  interna]  resources,  and  the 
less  dependent  we  are  on  foreign  powers  for  every  national  as  well  as  domestic 
purpose,  the  greater  and  more  stable  will  be  the  public  felicity.  By  the  increase 
of  domestic  manufactures,  will  the  demand  for  the  rude  materials  at  home  be  in- 
creased ;  and  thus  will  the  dependence  of  the  several  parts  of  the  Union  on  each 
other,  and  the  strength  of  the  Union  itself,  be  proportionably  augmented." — Fifth 
Annual  Message. 

"  Satisfied  am  I,  whatever  may  be  the  abstract  doctrine  in  favor  of  unrestricted 
commerce,  provided  all  nations  would  concur  in  it,  and  it  was  not  liable  to  be  in- 
terrupted by  war,  which  has  never  occurred,  and  can  not  be  expected,  that  there  are 
other  strong  reasons  applicable  to  our  situation  and  relations  with  other  countries, 
which  impose  on  us  the  obligation  to  cherish  and  sustain  our  manufactures.  Sat- 
isfied I  am,  however,  likewise,  that  the  interest  of  every  part  of  our  Union,  even 
those  benefited  by  manufactures,  require  that  this  subject  should  be  touched  with 
the  greatest  caution,  and  a  critical  knowledge  of  the  effects  to  be  produced  by  the 
slightest  changes." — Sixth  Annual  Message. 

From  J.  Q.  Adams's  Messages. 

"The  great  interest  of  an  agricultural,  commercial,  and  manufacturing  nation, 
are  so  linked  in  union  together,  that  no  permanent  cause  of  prosperity  to  one  of 
them  can  operate  without  extending  its  influence  to  the  other.  All  these  are  alike 
under  the  protecting  power  of  legislative  authority,  and  the  duties  of  the  representa- 
tive bodies  are  to  conciliate  them  in  harmony  together. 

"  Is  the  self-protecting  energy  of  this  nation  so  helpless,  that  there  exists  in  the 
political  institutions  of  our  country  no  power  to  counteract  the  bias  of  foreign  legis- 
lation ;  that  the  growers  of  grain  must  submit  to  the  exclusion  from  the  foreign 
markets  of  their  produce;  that  the  shippers  must  dismantle  their  ships,  the  trade 
of  the  north  stagnate  at  the  wharves,  and  the  manufacturers  starve  at  their  looms, 
while  the  whole  people  shall  pay  tribute  to  foreign  industry  to  be  clad  in  foreign 


138  HISTORY   OF    THE    PROTECTIVE    POLICY 

to  1830,  being  a  period  of  fifty  years.  That  it  was  also  sustained 
by  popular  opinion,  in  a  quarter  where  it  has  since  been  repudi- 

garbs ;  that  the  Congress  of  the  Union  are  impotent  to  restore  the  balance  in 
favor  of  native  industry  destroyed  by  the  statutes  of  any  realm?" — Fourth  Annual 
Message. 

Extract  of  a  Letter  from  Jndrew  Jackson,  1824,  to  Dr.  L.  H.  Culeman,  N.  C. 

"Heaven  smiled  upon  and  gave  us  liberty  and  independence.  That  same  Provi- 
dence has  blessed  us  with  the  means  of  national  independence.  .  .  He  has  filled 
our  mountains  and  plains  with  minerals  —  with  lead,  iron,  and  copper  —  and  given 
us  a  climate  and  soil  for  the  growing  of  hemp  and  wool.  These  being  the  great 
materials  of  our  national  defence,  they  ought  to  have  extended  to  them  adequate 
and  fair  protection,  that  our  manufacturers  and  laborers  may  be  placed  in  a  fair 
competition  with  those  of  Europe.  .  .  I  will  ask,  what  is  the  real  situation  of  the 
agriculturist  ?  Where  has  the  American  farmer  a  market  for  his  surplus  produce  ? 
Except  for  cotton,  he  has  neither  a  foreign,  nor  a  liome  market.  Does  not  this 
clearly  prove,  when  there  is  no  market  at  home  or  abroad,  that  there  is  too  much 
labor  employed  in  agriculture,  and  that  the  channels  for  labor  should  be  multi- 
plied ?  Common  sense  at  once  points  out  the  remedy :  Draw  from  agriculture 
this  superabundant  labor;  employ  it  in  mechanism  and  manufactures,  thereby 
creating  a  home  market  for  your  breadstuffs  —  distributing  labor  to  the  most  prof- 
itable account;  and  benefits  to  the  country  will  result.  Take  from  agriculture, 
in  the  United  States,  600,000  men,  women,  and  children,  and  you  will  nt  once  give 
a  market  for  more  breadstuffs  than  all  Europe  now  furnishes  us  with.  In  short, 
sir,  we  have  been  too  long  subject  to  the  policy  of  British  merchants.  It  is  time 
we  should  become  a  little  more  Jlmericanized,  and  instead  of  feeding  paupers  and 
laborers  of  England,  feed  our  own  ;  or  else,  in  a  short  time,  by  continuing  our 
present  policy,  we  shall  be  paupers  ourselves.  .  •  The  experience  of  the  late  war 
ought  to  teach  us  a  lesson,  and  one  never  to  be  forgotten.  If  our  liberty,  and  re- 
publican form  of  government,  procured  lor  us  by  our  Revolutionary  fathers,  are 
worth  the  blood  and  treasure  by  which  they  were  obtained,  it  is  surely  our  duty  to 
protect  and  defend  them.  .  .  It  is,  therefore,  my  opinion,  that  a  careiul  and  judi- 
cious tariff  is  much  wanted,  to  pay  our  national  debt,  and  afl'ord  us  the  means  of 
that  defence  within  ourselves  on  which  the  safety  of  our  country  and  liberty  de- 
pends ;  and  last,  though  not  least,  give  a  proper  distribution  to  our  labor,  which 
must  prove  beneficial  to  the  happiness,  independence,  and  wealth  of  the  com- 
munity." 

Froin  Jackson's  Second  Annual  Message. 

"The  power  to  impose  duties  upon  imports  originally  belonged  to  the  several 
states.  The  right  to  adjust  these  duties,  with  a  view  to  the  encouragement  of  do- 
mestic branches  of  industry,  is  so  completely  identical  with  that  power,  that  it  is 
difficult  to  suppose  the  existence  of  the  one  without  the  other.  The  states  have 
delegated  their  whole  authority  over  imports  to  the  general  government,  without 
limitation  or  restriction,  snving  the  very  inconsiderable  reservation  relating  to  the 
inspection  laws.  This  authority  having  thus  entirely  passed  from  the  states,  the 
right  to  exercise  it  for  the  purpose  of  protection  does  not  exist  in  them ;  and,  con- 
.sequently,  if  it  be  not  possessed  by  the  general  government,  it  must  be  extinct. 
Our  political  system  would  thus  present  the  anomaly  of  a  people  stripped  of  the 
right  to  foster  their  own  industry,  and  to  counteract  the  most  selfish  and  destruc- 
tive policy  which  misht  be  adopted  by  foreign  nations.  This  surely  can  not  be 
the  case:  this  indispensable  power, thus  surrendered  by  the  states, must  be  within 
the  scope  of  authority  on  the  subject  expressly  delegated  to  Congress.     In  this 


IN    THE    UNITED    STATES.  139 

ated,  the  remarkable  conclusion  of  the  ^^  Address  of  the  Society  of 
Tammany,  or  Columbian  Order,  to  its  absent  Members,  and  the 
Members  of  its  several  Branches  throughout  the  United  States, 
New  YorJc,  1819,"  found  in  the  note  below,*  will  sufficiently 
evince. 

The  address  itself  is  one  of  great  interest,  force,  and  eloquence. 
The  cause  of  Protection  was  never  advocated  more  earnestly,  or 
with  more  lucid  and  effective  arguments.  It  is  also  to  be  observed, 
that  the  letter  to  Dr.  Coleman,  cited  in  the  other  note,  written  by 
the  great  chief  of  the  "  Tammany  Society"  party,  and  dated  five 
years  after  this  address,  is  sufficiently  clear  and  decided  in  its  ad- 
vocacy of  a  protective  system,  as  also  the  extract  from  his  message 
to  congress,  in  1830. 

There  are  no  facts  of  history  better  certified,  than,  that  the 
necessity  of  a  protective  system  for  the  states,  was  the  main  subject 
of  deliberation  at  the  first  convention  of  delegates  at  Annapolis,  in 
1786,  assembled  to  consider  the  question  of  a  constitution  ;  and 
at  the  second,  in  1787,  when  the  constitution  was  framed  ;  and 
that,  to  obtain  the  power  to  establish  such  a  system,  was  a  leading 
purpose  of  that  instrument.     General  Washington,  the  president, 

conclusion  I  am  confirmed,  as  well  by  the  opinions  of  Presidents  Washington,  Jef- 
ferson, Madison,  and  Monroe,  who  have  each  repeatedly  recommended  this  right 
under  the  constitution,  as  by  the  uniform  practice  of  Congress,  the  continued  acqui- 
escence of  the  states,  and  the  general  understanding  of  the  people." — 1830. 

•  «  \\rp  recommend  to  you,  brethren,  to  be  examples  of  moderation  and  firmness 
to  your  fellow-citizens,  and  to  hold  fast  of  those  stern  Revolutionary  principles 
which  gave,  and  which  alone  can  preserve  your  independence. 

"  Clarkson  Crolius,  Grand  Sachem. 

"  James  S.  Martin,  Secretary. 

"  Countersigned  by  John  Woodward,  Clarkson  Crolius,  Joseph  P.  Simpson,  James 
S.  Martin,  Benjamin  Romaine,  Matthew  L.  Davis,  William  Mooney,  Committee 
of  Correspondence.     New  York,  October  4,  1819. 

"  Resolutions  of  the  Society  of  Tammany,  or  Columbian  Order,  passed  October 

11,  1819. 

"Resolved,  That  as  friends  to  our  country,  we  recommend  to  our  brethren  of 
the  different  societies  of  Tammany,  or  Columbian  Order,  the  necessity  as  well  as 
moral  duty,  to  our  country,  ourselves,  and  posterity,  of  refraining  from  every  spe- 
cies of  useless  extravagance  in  our  mode  of  living  ;  especially  in  furniture,  dress, 
the  table,  ostentatious  equipa2;e,  and  expensive  amusements. 

"Resolved,  That  we  will  discmmienance  the  importation  and  use  in  our  families 
of  every  species  of  foreign  manufacture  or  production,  which  can  or  may  be  reasona- 
bly substituted  by  the  fabrics  or  productions  of  the  United  States. 

"  Resolved,  That  as  '  economy  is  wealth,'  we  seriously  recommend  to  our  breth- 
ren throughout  the  United  States  a  strict  and  rigid  observance  of  this  great  moral 
duty  in  their  families  and  social  intercourse." 


140  HISTORY    OF    THE    PROTECTIVE    POLICY 

appeared  in  a  domestic  suit  before  the  first  congress,  under  the 
new  constitution;  their  second  act,  as  stated  above,  was  a  law 
"  for  the  encouragement  and  protection  of  domestic  manufactures  ;" 
and  fifteen  members  of  that  body,  with  James  Madison  at  their 
head,  were  also  members  of  the  convention  that  framed  the  con- 
stitution, who  could  not  be  ignorant  of  its  great  purpose,  when  they 
assisted  in  passing  this  law.  The  continued  action  of  the  gov- 
ernment, therefore,  upon  this  subject,  for  fifty  years,  as  shown 
without  any  apparent  diversity  of  opinion  —  certainly  with  great 
unanimity  —  was  a  natural  consequence  of  such  a  beginning,  stim- 
ulated by  such  powerful  causes,  derived  from  the  experience  of 
the  people. 

But  the  personal  strifes  of  aspirants  for  the  presidency,  who 
have  been  more  concerned  for  their  own  success  than  for  the  public 
weal,  have,  within  twenty  years,  introduced  a  new  era  in  the  polit- 
ical character  and  tendencies  of  the  country,  and  put  in  peril  the 
grand  purpose  of  the  American  revolution  and  of  American  inde- 
pendence. We  have  witnessed  the  strange  spectacle  of  public 
men,  occupying  the  position  of  leaders,  wheeling  to  the  right  and' 
to  the  left,  and  right  about  face,  and  turning  somersets,  on  the  most 
grave  and  momentous  questions  of  public  policy,  drawing  their 
devoted  followers  in  their  train,  without  any  reason  to  be  accounted 
for,  except  that  of  personal  ambition  ;  because  such  a  total  change 
of  opinion,  so  suddenly  transpiring,  on  questions  the  aspects  of 
which  have  not  changed,  may  be  set  down  as  a  moral  impossibility 
with  sagacious  and  far-seeing  minds,  except  in  cases  where  "  the 
wish  is  father  to  the  thought."  Public  and  ambitious  men,  seeing 
that  they  could  not  accomplish  their  ends  in  one  way  and  by  one 
set  of  means,  would  seem  to  have  come  to  the  conclusion  to  try 
another  way  and  another  set  of  means,  without  regard  to  the  good 
of  the  country. 

The  government  and  institutions  of  the  United  States,  as  we 
have  seen,  started  into  being  on  the  basis  of  the  protective  policy 
—  were  begotten  by  it.  This  policy  was  the  native  genius  of  the 
people  ;  it  was  the  natural  growth  of  their  position,  of  their  struggles, 
and  of  their  original  and  subsequent  relations.  It  was  a  necessity 
imposed  upon  them  by  Providence,  from  which  they  could  not 
escape  with  impunity.  It  was  the  natural  suggestion  of  their 
instincts,  as  impressed  upon  them  by  their  history  and  experience. 
They  were  forced  into  it,  and  they  never  could  get  out  of  it,  ex- 
cept by  violence  and  sacrifice.     Everything  in  nature,  everything 


IN    THE    UNITED    STATES.  141 

in  morals,  and  everything  in  human  prudence  and  foresight,  pointed 
that  >vay.  F^or  this,  they  were  forced  into  the  revolution  ;  for  this, 
they  were  forced  out  of  the  confederation  ;  to  secure  this,  they 
adopted  the  federal  constitution  ;  for  this,  they  continued  to  legis- 
late on  that  platform  for  fifty  years ;  and  behold,  in  ten  years,  from  ^ 
1S30  to  1840,  this  mighty  fabric,  which  had  cost  rivers  of  blood, 
and  mountains  of  wealth,  after  having  occupied  more  than  two 
centuries  in  building  —  for  it  dates  back  to  the  first  setdements  of 
the  country — was  all  leveled  with  the  ground  !  It  was  rebuilt  in 
1842,  and  in  1846  is  again  overthrown  !  Such  is  the  history  of 
the  protective  policy  in  the  United  States. 


i  * 


>%  ^ 


.  142  THE    DESTINY    OF    AMERICAN    FREEDOM 

-  ^  /chapter  IX. 


X 


THE    DESTINY    OF    AMERICAN    FREEDOM    NOT    YET    ACHIEVED. 


The  general  Desire  for  Freedom,  before  and  after  the  Discovery  and  Settlement  of  Amer- 
ica.— American  Independence  an  Epocii  of  Freedom. — "An  American  System"  means 
much. — It  is  a  "  Commercial  System '' — "  Pdliticul''  the  Shadow,  "  Commercial''  the 
Substance. — The  Responsibility  of  a  Nation  that  has  Freedom  in  Trust  for  Posterity  and 
for  Mankind. — Faith  as  a  Power  in  Man  for  the  Attainment  of  Freedom. — The  Advo- 
cates of  Freedom  are  in  general  practically  Rii-'ht,  though  often  theoretically  Wrong. — 
Freedom  yet  in  it.s  Cradle. — The  vacillating  Policy  of  the  Country  in  regard  to  the 
Means  of  Freedom — Seventy  Years  of  the  Era  of  American  Freedom  gone,  and  yet 
Freedom  was  to  be  Defined. — The  People  have  much  to  Learn  on  this  Subject. — What 
Great  Biitain  and  Europe  Desire. — The  Jeopardy  of  American  Freedom. — Free  Trade 
would  throw  it  away  —  would  Sell  It. 

Having  shown,  in  Chapter  VH.,  that  freedom  consists  in  the 
enjoyment  of  commercial  rights,  and  in  the  independent  control  of 
commercial  values  fairly  acquired,  we  propose,  in  this  chapter,  to 
call  to  mind  the  historical  facts,  that  society  in  Europe,  had  been 
tendins:  for  centuries  toward  freedom,  before  an  outlet  of  its  un- 
satisfied  population  was  opened  in  the  discovery  of  the  New 
World  ;  that  hopes  and  designs  of  political  emancipation,  for  the 
most  part,  lay  at  the  foundation  of  the  movements  of  immigrants  to 
this  quarter;  and  that  the  American  colonic^,  especially  in  the 
north,  were  founded  in  this  spirit.  And  we  refer  to  these  facts  for 
the  purpose  of  showing,  that  freedom  is  progressive,  and  is  never 
gained  fully  at  a  single  leap. 

The  royal  charters,  so  far  as  the  influence  of  those  who  obtained 
them  could  effect  it,  were  studiously  framed  for  the  security  of 
rights  held  dear  by  the  colonists  ;  and  the  political  history  of  the 
early  settlements  is  one  of  perpetual  struggle  between  royal  pre- 
rogatives and  popular  claims.  The  cause  of  freedom  continued  to 
advance,  in  the  minds  and  hearts  of  the  people  of  this  new  world. 
Events  were  constantly  ripening  in  North  America  for  an  epoch, 
which  ultimately  found  its  date  in  the  establishment  of  American 
independence.  It  was  literally,  and  in  the  most  emphatic  sense  of 
the  term,  an  epoch  of  freedom.  It  was  not  an  accident  of  the 
day  ;  but  it  was  the  event  of  centuries  of  preparation.  All  its  seeds 
were  transplanted  from  Europe.  Society  there  had  long  been 
laboring  for  this  birth.  There  was  no  safety,  in  that  quarter,  for 
the  cradle  of  freedom,  in  such  an  enlarged  sense ;  nor  could  its 


"t-^'-'*^     fc-'l-^ 


^/^     ^    ^A^iAi.^i-'^yf^^    ^    %L>C<^- y^-^^-t^    /^'*T_^--  ^^^A*-' 

^^  '^^Ay^<^     ..^^e^-t^    /•''^^.-•-w^      ^-^^-i-    ^-ii^^cJ^    2SI 


^/  NOT    YET    ACHIEVED.  ^  143 


swaddling  clothes  be  prepared  here,  till  ages  had  rolled  away. 
Nevertheless,  they  were  being  made  all  the  while  by  careful  hands, 
from  the  time  when  Jamestown,  Plymouth,  and  New  Amsterdam, 
obtained  a  place  in  history,  till  the  first  blood  of  the  American 
revolution  stained  this  virgin  field.  From  that  hour  is  dated  a  new 
epoch  in  the  history  of  freedom.  From  that  hour  commenced  a  new 
modification  of  society,  under  a  new  system.  System  is  the 
word  which  denotes  this  new  state  of  things  —  the  American 
SYSTEM.  Will  any  American  deny,  that  there  is,  and  that  there 
ought  to  be  an  American  System  ?  System  of  what  ?  Of 
what  principles?  What  is  its  foundation,  its  parts,  its  structure? 
Wherein  is  it  peculiar?  Does  it  differ  from  European  systems? 
And  if  so,  in  what  ?  It  is  called  freedom;^ — was,  in  fact,  a  great 
advance  in  freedom.  In  what,  then,  does  this  freedom,  this  system, 
consist?  The  answer  to  this  question  is  found  in  the  argument 
of  Chapter  VII.  —  in  commercial  rights.  It  comes,  then,  to 
this,  that  the  whole  of  the  American  system,  so  far  as  it  is  a 
peculiar  one,  is  a  commercial  system,  for  the  establishment  and 
defence  of  commercial  rights.  It  is  commonly  called  political. 
But  political  is  the  shadow;  commercial,  the  substance.  The 
former  characterizes  the  thing  socially  ;  the  latter  denotes  the  thing 
itself.  Hence  the  name  most  commonly  employed  to  denote  the 
subject  in  its  social  aspects  —  '■'■ 'poliiical  economy;"  but  we  have 
preferred  that  of  public  economy,  for  reasons  specified  in  the  first 
chapter.  The  system  is  political,  as  being  expedient,  best,  in  its 
relations,  or  designed  to  be  so ;  but  its  positive  character  is  entirely 
a  commercial  one. 

An  American  system  supposes  relations  to  something  foreign  ; 
and  it  hardly  need  be  said,  that  these  relations,  for  the  most  part, 
have  respect  to  a  state  or  to  states  of  things,  in  those  quarters 
whence  these  new  and  independent  legislators  came ;  that  is,  from 
the  European  world.  And  as  a  new  and  peculiar  system,  it  also 
supposes  a  new  and  peculiar  state  of  society  —  commercial  society, 
be  it  observed,  not  meaning,  however,  anything  other  thereby  than 
political ;  for  it  is  both,  and  in  both  identical.  But  having  ex- 
plained the  sense  in  which  we  use  the  term,  commercial,  in  this 
connexion,  it  is  expedient  to  adhere  to  it,  in  the  present  train  of 
reasonin"-,  that  we  lose  not  siijht  of  the  fundamental  doctrine  estab- 
lished  in  Chapter  VII.,  to  wit,  that  freedom  consists  in  the  enjoy- 
ment of  commercial  ris-hts.  It  is  the  substance,  and  not  the 
shadow,  which  we  wish  to  follow  up. 


144  THE    DESTINY    OF    AMERICAN    FREEDOM 

It  is  the  interest  of  labor  alone  that  claims  to  be  considered  in  the 
formation  of  an  American  commercial  system.  Labor,  in  every 
part  of  the  world,  is  the  primary  and  fundamental  power  of  states ; 
and  the  question,  in  public  economy,  is,  whether  its  benefits  shall 
accrue  to  the  laborer  himself,  in  the  shape  of  compensation,  or  to 
other  parties  that  absorb  it  to  themselves  by  oppression  and  wrong, 
in  allowing  labor  only  a  bare  subsistence.  The  latter  alternative 
is  the  European  system;  the  former  is  intended  to  be  the  Amer- 
ican ;  and  whether  it  shall  be  maintained,  depends  entirely  on  the 
maintenance  of  the  difference  in  the  price  of  labor,  by  an  American 
commercial  system,  in  relation  to  foreign  parts.  It  is  exclusively 
a  commercial  question,  determined  by  a  commercial  principle, 
which  ffoverns  the  whole  commercial  world,  and  is  defined  with  all 
the  accuracy  of  figures.  It  is  simply,  whether  the  power  of  one,  in 
trade,  is  equal  to  the  power  of  three ;  in  other  words,  whether 
American  labor,  which  costs  three,  can  stand,  in  the  same  market, 
against  European  labor,  which  costs  one ;  for  that  is  about  the 
average  difference. 

It  is  not  pretended,  as  stated  elsewhere,  that  it  is  necessary  for 
an  American  system  to  afford  an  average  protection  to  American 
labor,  equal  to  this  difference,  because  it  is  understood  and  known, 
that  the  very  design  of  the  European  system,  in  depriving  labor  of 
its  fair  reward,  is  to  appropriate  the  wages  kept  back  to  aggrandize 
the  usurpers,  and  that  the  aims  of  such  usurpation  would  be  dis- 
appointed, if  the  wide  margin  of  this  difference  were  all  absorbed 
in  a  commercial  competition.  A  very  small  fraction  of  it  will 
ordinarily  answer  the  purpose  of  such  a  strife ;  and  the  smallest 
possible  fraction  by  which  one  producer  can  undersell  another,  will 
always  secure  the  market.  It  is  the  fact  of  this  difference,  and 
the  immense  power  which  it  gives  to  European  labor  over  Amer- 
ican, which  claims  the  consideration  of  American  statesmen,  that 
their  eyes  shoidd  ever  be  open  to  the  points  on  which  this  power  may 
be  brought  to  bear,  and  to  the  amount  of  it  that  may  be  employed 
in  any  given  direction.  For  American  statesmen  to  forget,  to 
deny,  or  not  to  see,  that  this  adverse  power  exists,  and  that,  in  the 
hands  of  those  who  wield  it,  it  is  ever  on  the  alert  to  embrace  its 
opportunities  to  assail  the  vulnerable  points  of  the  American  sys- 
tem, is  one  and  the  same  thing  as  to  withdraw  the  shield  of  Amer- 
ican freedom,  and  leave  it  entirely  at  the  mercy  of  those  from 
whom  it  was  purchased  with  so  much  blood  and  treasure,  and  by 
ages  of  strife  and  agony.     The  vulnerability  will  be  found  at  pvprv 


NOT    YET    ACHIEVED.  145 

point  where  foreign  cheap  labor  comes  into  competition,  in  our 
own  market,  with  American  labor,  whether  it  be  labor  already  in 
action,  or  labor  ready  to  go  into  action,  under  adequate  encourage- 
ment. The  right  of  chances,  as  remarked  in  another  place,  is  as 
sacred  as  the  right  of  possession.  „^ 

Jt  is  entirely  false  to  say,  as  Free  Trade  avers,  that  an  American 
system  controls  labor,  and  forces  it  into  unnatural  channels,  oper- 
ating unequally  and  unjustly  on  different  departments,  encouraging 
one  kind,  and  discouraging  another.  Such  is  neither  the  design, 
nor  practical  operation  of  the  system.  It  is  based  on  the  principle 
of  encouragement,  not  of  control;  of  protection,  not  of  injustice; 
of  invitation  to,  not  of  prohibition  of,  home  labor.  It  is  to  call  out 
the  dormant  energies  of  the  people,  by  opening  the  door  to  new 
enterprises,  which  can  not,  by  any  possibility,  operate  to  the  dis- 
advantage of  any  other ;  bnt,  on  the  contrary,  must  necessarily 
benefit  all  others,  by  diminishing  the  number  engaged  in  each,  and 
affording  them  abetter  chance,  at  the  same  time  that  it  increases 
the  demand  for  their  products,  by  raising  up  new  customers.  We 
do  not  mean,  that  the  multiplication  of  pursuits,  under  such  a  sys- 
tem, as  a  matter  of  course,  diminishes  the  number  engaged  in  each, 
positively,  but  relatively.  It  prevents  them  from  being  over- 
crowded, to  make  them  unprofitable,  and  makes  each  more  prof- 
itable, as  elsewhere  shown. 

The  great  error,  therefore,  in  this  branch  of  the  general  argument, 
as  committed  by  the  Free-Trade  economists,  is  one  of  principle. 
They  assume,  that  a  commercial  system,  enacted  for  the  protection 
of  home  industry,  controls  labor,  and  thereby  operates  to  the  disad- 
vantage of  other  branches  not  comprehended  in  any  specific  acts 
of  protection  ;  whereas,  the  practical  operation  of  such  a  system, 
in  the  United  States,  is  a  mere  invitation  to  labor  and  capital,  that 
lie  dormant,  or  which  are  not  so  profitably  employed  as  they  might 
be  under  these  new  encouragements.  It  neither  controls  the  labor 
or  capital  so  invited  into  a  new  field,  nor  any  other  branches  of 
them.  It  injures  no  other,  but  benefits  all.  There  may,  indeed, 
be  a  negative  injustice  done  to  some  branches  of  industry,  by  a 
partial  distribution  of  protection,  which  ought  to  be  avoided  ;  but  it 
is  impossible  there  should  be  any  positive  injustice  in  any  quarter ; 
it  is  impossible,  indeed,  that  there  should  not  be  a  universal  benefit, 
by  every  new  pursuit  that  is  called  into  being,  under  such  a  sys- 
tem, unless  it  can  be  shown,  that  some  parties  are  positively  taxed 
by  protection  extended  to  others.     But  it  is  abundantly  proved, 

10 


* 


146  THE    DESTINY    OF    AMERICAN    FREEDOM 

elsewhere  in  this  work,  that  such  is  not  the  fact  in  the  operation  of 
an  American  system  of  Protection  ;  but,  on  the  contrary,  with  no 
exception  that  is  permanently  injurious  to  any  party  whatever,  that 
the  protected  articles  which  we  wish  to  be  cheapened,  such  as  those 
of  manufacture,  are  cheapened  by  protection ;  and  that  those,  the 
prices  of  which  we  wish  to  sustain,  and  if  possible,  to  raise,  such 
as  those  of  agriculture,  and  such  as  labor  itself,  are  sustained  and 
raised  by  the  same  means. 

Freedom,  in  the  social  state,  is  a  thing  of  great  price,  because  it 
is  of  great  cost.  Centuries  rolled  away,  in  that  great  strife,  which 
terminated  in  the  birth  of  American  freedom.  Empires  were 
shaken  and  revolutionized,  and  thrones  tottered  and  fell,  in  the 
long  agony.  And  what  was  this  for  ?  That  the  rightful  owners 
of  all  commercial  values  might  hold  their  own,  and  control  it. 
Analyze  the  things  wiiich  men  hold  dear  on  earth,  sift  them  to  their 
foundation,  enter  the  magazines  of  all  terrestrial  good,  and  the  wheat 
will  be  found  to  consist  in  commercial  values. 

There  is  a  great  responsibility  resting  on  the  nation  that  has 
attained  to  the  greatest  degree  of  freedom,  and  secured  to  every 
citizen  the  undisturbed  possession  and  independent  control  of  his 
own  —  a  responsibility,  not  only  as  a  spectacle,  an  example  for 
mankind,  but  as  involving  a  trust  for  posterity.  To  throw  it  away, 
is  not  simply  a  folly,  but  it  is  a  crime  against  the  human  race. 
The  people  of  the  United  States  occupy  precisely  this  position. 
Their  forefathers  gained  for  them  a  priceless  boon,  in  one  great 
struggle,  and  by  hazards  and  costs  not  to  be  estimated,  handed 
it  down  as  a  charge  to  keep  and  bequeath  to  endless  generations, 
or  till  human  society  should  be  dissolved  by  the  fiat  of  Heaven, 
and  till  all  its  members  shall  come  to  judgment.  And  what  is  that 
boon?  Simply,  as  before  shown,  that  every  man  may  enjoy  his 
own  commercial  rights,  without  disturbance,  and  without  liability 
to  depredation  ;  and  these  rights  are  not  less,  but  more,  in  the 
chances  of  the  future,  than  in  the  present. 

'Faith,  as  an  attribute  of  man,  for  a  better  state  on  earth  and 
hereafter,  considered  as  a  general  sentiment,  is  providential.  Men 
can  not  always  tell  why  or  how  it  comes ;  but  they  have  it ;  and 
this  faith  is  itself  the  parent  of  the  thing  which  they  desire.  It  is 
evident  enough,  that  there  was  a  strong  faith  in  general  society, 
that  the  discovery  of  America  would  open  a  new  era  in  the  history 
of  the  world.  What  specific  forms  these  expected  events  would 
assume,  was  of  course  a  secret  to  those  who  confided  in  their 


NOT    YET    ACHIEVED.  147 

future  development.  Nevertheless,  such  a  faith  existed,  and  had  a 
potent  influence  on  the  minds  of  men  —  especially  of  those  who 
embarked  in  the  various  enterprises  of  settling  the  new  continent. 
This  undefined  expectation  at  last  took  shape  and  a  palpable  form 
in  the  achievement  of  American  independence,  which  we  have 
marked  as  an  Epoch,  in  the  highest  and  most  enlarged  sense  of 
the  term  —  a  point  in  the  progress  of  society,  to  be  followed  by 
new  scenes,  in  a  new  drama,  of  an  indefinite  and  inconceivable 
extent,  as  to  the  future,  but  all  deriving  a  character  from  this  grand 
event.     We  call  it  an  Epoch  in  the  progress  of  freedom. 

It  will  be  observed,  that  we  have  devoted  a  chapter  expressly  to 
illustrate  and  establish  the  proposition,  that  freedom,  consists  in  the 
enjoyment  and  independent  control  of  commercial  values  by  and 
among  those  who  create  them,  or  who,  by  the  usages  of  society, 
rightfully  come  into  their  possession  as  heirs.  We  mean  chiefly 
those  who  create  them  ;  but  the  rights  of  heritage  can  not  be 
denied,  and  in  all  ages,  and  in  all  states  of  society,  have  been  held 
sacred.  We  are  not  aware,  that  there  can  be  any  objection  to  such 
a  state  of  society,  where  all  rights  of  primogeniture  and  of  entail 
are  nullified  by  fundamental  law.  By  the  creators  of  commercial 
values,  it  will  of  course  be  understood,  that  we  mean  all  those, 
who  fairly  acquire  property,  or  a  valuable  position,  in  any  way, 
directly  or  indirectly,  by  their  labor,  industry,  or  skill,  in  any  pur- 
suit of  life.  Our  object  in  this  definition  of  freedom,  has  been  to 
erect  a  wall  between  the  rightful  owners  of  commercial  values,  and 
the  usurpers  of  them  ;  and  the  design  of  our  argument  on  this 
point  has  been  to  show,  that  freedom  is  not  an  abstraction,  but  the 
enjoyment  of  a  valid  commercial  consideration.  As  much  as  free- 
dom is  supposed  to  be  worth,  there  is  scarcely  any  subject  on 
which  its  advocates  have  more  indistinct,  vague,  and  indefinite 
notions,  as  one  of  speculation.  Practically  they  are  pretty  sure  to 
be  right ;  theoretically  not  so  much  so. 

What  we  have  proposed  to  show  in  this  chapter,  in  connexion 
with  the  numerous  propositions  allied  to  this,  which  we  have  en- 
deavored to  establish  in  other  parts  of  this  work  —  and  which, 
therefore,  we  here  assume  as  established  —  is,  that  the  destiny  of 
American  freedom  is  not  yet  achieved.  We  might,  indeed,  say, 
with  much  appearance  of  reason,  that  it  is  scarcely  begun  to  be 
achieved.  As  before  remarked,  it  took  centuries  to  establish  the 
epoch.  The  era  commencing  with  that  date  will  extend,  as  we 
trust,  into  a  long  and  indefinite  future.     It  may,  perhaps,  be  as- 


148  THE    DESTINY    OF    AMERICAN    FREEDOM 

sumed,  that  it  has  scarcely  begun  to  develop  itself.  That  three 
score  and  ten  years  of  this  era  should  have  passed  away,  the  peo- 
ple in  the  meantime  boasting  of  freedom,  and  yet,  that  we  should 
have  occasion  to  attempt  to  define  what  freedom  consists  in,  at  this 
day,  is  a  curious  fact;  and  that  that  definition  should  be  entirely 
new,  is  a  very  instructive  fact,  if  it  be  also  true.  That  the  people 
of  this  country,  under  their  new  organization  of  society,  with  every 
possible  chance  to  establish  freedom  on  a  permanent  and  immova- 
ble basis,  should  have  made  such  mistakes  as  are  proved  in  other 
parts  of  this  work,  in  regard  to  the  protection  of  their  own  commer- 
cial rights,  which,  in  the  present  day,  comprehend  all  rights  of  any 
consequence  ;  that  they  should  have  gone  on  for  seventy  years, 
blundering,  so  to  speak,  in  bhnd  and  dark  ways,  often  overwhelmed 
witli  public  and  private  misfortune,  without  having  been  able  to 
determine  on  any  system  of  public  economy,  as  a  permanent  one, 
but  for  ever  vacillating  from  one  extreme  to  another ;  that  Free 
Trade  should  be  the  dominant  principle  of  one  time,  and  that  of 
Protection  soon  after,  alternating  as  regularly  as  the  pendulum  of 
a  clock  ;  that  opinion  on  this  great  question,  on  which  so  much  de- 
pends, should  still  be  divided,  and  doubtful  with  many  what  will 
be  the  end  of  it  all  ;  if,  indeed,  freedom  be  involved  in  this  ques- 
tion, as  we  sincerely  and  profoundly  believe  it  is,  such  a  history 
goes  far  to  prove,  that  the  foundation  on  which  it  rests,  and  the 
pivot  on  which  it  turns,  are  yet  but  poorly  apprehended. 

Nevertheless,  this  slow  progress  of  freedom  —  we  assume  to  call 
it  so,  from  what  we  have  proved  —  is  not  so  discouraging  as  might 
at  first  sight  be  supposed.  It  does  not  show,  that  the  people  of 
this  country  do  not  understand  what  freedom  is  practically;  but  only, 
that  they  have  yet  much  to  learn  as  to  the  theory  of  best  securing 
its  ends.  It  proves,  too,  that  freedom,  like  all  good  things,  on  earth 
and  in  heaven,  is  a  costly  blessing,  hard  of  attainment.  The  Amer- 
ican fathers,  who  wasted  their  treasures  and  shed  their  blood  for  it, 
were,  without  doubt,  in  the  right  path.  So  were  the  founders  and 
framers  of  our  government  and  its  institutions.  So,  generally,  has 
been  the  march  of  our  history  ;  and  so,  above  all  things,  are  the 
instincts  of  the  people.  Let  the  people  once  understand,  that  free- 
dom is  not  a  vague  abstraction,  floating  high  above  their  heads,  but 
a  palpable  thing,  like  cash  in  hand  ;  that  it  consists  in  the  enjoy- 
ment of  their  own  commercial  rights,  and  in  the  independent  con- 
trol of  their  own  commercial  values,  such  as  they  have  fairly  earned 
by  their  own  hard  toil,  or  by  their  skill  and  enterprise,  or  such  as 


NOT    YET    ACHIEVED.  3  49 

they  have  received  from  their  fathers,  or  their  fathers'  fathers,  who 
obtained  them  in  the  same  honest  way  ;  let  them  understand,  that 
the  original  controversy  with  the  British  crown,  on  this  very  soil,  was 
about  these  very  things,  and  nothing  else  ;  that  the  occasion  of  that 
controversy  was  the  degradation  of  labor  in  Europe,  and  the  at- 
tempt to  keep  it  down  here  ;  that  it  was  the  robbery  of  labor  of  its 
fair  reward,  of  its  rights  ;  and  that  the  Free-Trade  system  operates 
precisely  in  the  same  manner,  and  to  the  same  effect,  on  the  com- 
mercial rights  of  the  American  people,  to  rob  them  of  their  com- 
mercial values,  as  did  that  system  of  oppression  and  wrong  ao-ainst 
which  the  American  fathers  rebelled  ;  and  it  will  not  take  long, 
after  that,  for  the  American  people  to  understand  what  freedom  is. 

We  have  shown,  elsewhere,  that  the  claim  of  Free  Trade,  among 
us,  to  buy  cheaper  of  foreigners  than  we  can  buy  at  home,  and  to 
sell  to  them  on  better  terms,  amounts  to  nothing  ;  that,  indeed,  the 
argument  on  this  point  is  reversed  ;  that  a  protective  system  is  more 
economical,  to  all  parties,  in  all  these  respects;  and  that,  under  it, 
we  can  go  forth  into  the  market  of  the  world,  and  rival  those  very 
foreigners,  who,  it  is  averred,  would  sell  to  us  cheaper.  How  could 
they  sell  to  us  cheaper,  if  we  could  rival  them  in  the  foreign  mar- 
ket?     The  absurdity  is  manifest,  and  the  argument  conclusive. 

Turn  which  way  we  will,  in  the  consideration  of  this  subject,  its 
aspects  strike  us  everywhere  the  same.  The  establishment  of 
American  independence  was,  beyond  all  question,  an  epoch  of 
freedom;  that  freedom  consisted  in  the  enjoyment  of  commercial 
rights,  and  in  the  independent  control  of  commercial  values  by  and 
among  those  to  whom  they  belonged  ;  the  very  fact  that  these  rights 
were  redeemed,  proves,  that,  having  been  once  usurped  by  wrong, 
and  subsequently  rescued,  they  may  be  again  usurped,  and  that 
they  require  protection  ;  and  yet  Free  Trade  has  the  audacity  to 
propose,  that  this  protection  should  be  withdrawn.  The  question, 
-^  ^  therefore,  between  Protection  and  Free  Trade,  in  the  United  States, 
is  for  ever  and  necessarily  a  question  of  freedom  —  a  freedom  ac- 
quired by  force  of  arms,  at  great  expense  of  blood  and  treasure, 
requiring  to  be  defended  by  a  public  policy ;  a  freedom  which 
Peee  Trade  offers  for  sale  !  Or,  if  it  can  not  sell  it,  to  throw  it  to 
the  winds  of  heaven,  as  if  it  cost  nothing,  and  were  worth  nothing! 
>  Ifik  American  freedom  does  not  consist  in  these  things,  then  it  is 
nothing ;  then  the  strifes  of  the  American  revolution,  and  the  cost 
of  American  independence,  were  without  excuse,  and  a  waste; 
then  there  was  no  good  reason  for  that  contest,  and  the  result  is  a- 


150      DESTINY  OF  AMERICAN  FREEDOM  NOT  YET  ACHIEVED. 

failure.  Who  will  say  this?  Doubtless  something  was  acquired  ; 
and  doubtless  there  remains  something  to  defend,  besides  an  empty- 
name.  What  is  it?  Where  is  it?  In  what  does  it  consist?  Whose 
property  is  it?  If  we  have  not  already  answered  these  questions, 
we  know  not  how  it  is  to  be  done.  If  it  is  not  in  every  man's  own 
position,  as  it  is  precious  to  himself;  as  it  enables  him  to  live  more 
to  his  satisfaction,  than  he  could  otherwise  do ;  as  it  gives  him  a 
house  and  home,  food  and  raiment,  education  for  himself  and  chil- 
dren, comfort,  happiness  —  all  without  fear  of  deprivation  ;  in  a 
word,  if  it  does  not  consist  in  the  use,  enjoyment,  and  independent 
control  of  those  commercial  values,  which  he  can  call  his  own,  and 
which  he  knows  are  his  own,  because  he  created  them,  or  received 
them  from  his  father,  then,  we  confess,  we  do  not  know  where  to 
find  the  thing  called  freedom. 

It  can  not  be  denied,  that  this  controversy  has  opened  up  to  us 
at  last  some  very  grave  features.  On  the  one  hand,  we  behold  the 
suffering  and  the  virtuous  of  mankind,  for  centuries,  carefully  watch- 
ing the  ripening  of  the  fruit  of  the  tree  of  liberty,  gathering  it  as  it 
falls  into  their  lap,  and  garnering  it  up  for  use,  till  a  concentrated 
family  of  its  devotees  have  proclaimed  their  rights,  and  sworn  to 
defend  them.  They  have  sown  their  seed,  and  awaited  their  time 
in  patience.  But,  on  the  other  hand,  while  these  newly-planted 
fields  were  ripening  to  the  harvest,  the  sickle  in  the  hands  of  the 
reapers,  and  every  prospect  full  of  hope,  a  cry  is  raised,  that  this 
harvest  is  common  property,  and  the  whole  world  rush  in,  each 
one  to  snatch  what  he  can  in  the  melee.     This  is  Free  Trade. 


y. 


THE    DIFFERENT    STATES    OF    SOCIETY.  151 


CHAPTER    X. 

THE  DIFFERENT    STATES  OF    SOCIETY  IN    EUROPE   AND  AMERICA 
REQUIRE    DIFFERENT    SYSTEMS    OF    PUBLIC    ECONOMY. 

The  three  fundamental  Elements  of  European  Economists. — Adam  Smith's  and  Ricardo's 
Statement  of  them. — These  Elements  do  not  exist  in  the  United  States  as  a  Rule,  but 
only  as  Exceptions. — The  Ancient  System  of  European  Society  gives  Character  to 
the  Modern. — The  economical  Position  of  the  Laborer  there,  the  same  as  that  of  the  Ox 
or  the  Slave. — This  Position  assigned  to  Labor  by  European  Economists,  as  proved  by 
their  own  Statements. — The  Theory  of  Malthas  justifies  this  Position. — This  Doctrine 
pervades  the  European,  and  has  been  transferred  into  American  Systems  of  Economy. 
— The  prevalent  Principle  of  Land  Tenures  in  Europe  fundamentally  different  from 
that  which  prevails  in  the  United  States. — "Rent"  the  lord  of  all  in  Europe — The  Prin- 
ciple of  Serfdom  and  V'illanage,  under  other  names,  still  prevails  in  that  quarter  of  the 
World. — Labor  doomed  there. — American  Society  fundamentally  different. — The  same 
System  of  Public  Economy  can  not  apply  to  each. — Reform  in  America,  slow,  but  sure. 
— Can  only  be  effected  by  Public  Economy. — Free-Trade  Economy  hostile  to  Popular 
Rights. 

Having  disclosed,  in  Chapter  II.,  the  contingent  basis  on 
which  a  system  of  public  economy  must  rest,  and  the  contingent 
ground  on  which  alone  its  propositions  can  be  established,  to  wit, 
the  application  of  experience  to  a  given  state  of  things,  it  may  be 
useful,  in  this  stage  of  the  inquiry,  to  exhibit  some  of  the  points 
of  difference  in  the  states  of  European  and  American  society,  to 
both  of  which,  it  is  preposterously  claimed  by  the  advocates  of 
Free  Trade,  that  a  common  system  of  economy  is  equally  applicable. 

The  British  economists  of  the  Free-Trade  school,  have  agreed 
on  the  fundamental  elements  of  public  economy,  which,  they  aver, 
comprehend  the  entire  basis  of  the  superstructure,  on  which,  and 
on  the  ramifications  growing  out  of  ihem,  are  based  all  the  propo- 
sitions of  their  system.  The  importance  of  the  position  of  these 
fundamental  elements  in  their  system,  arises  from  the  fact  that  all 
their  reasonings  are,  directly  or  indirectly,  founded  upon  them. 
We  propose  to  show  that  two  of  these  three  distinct  supports  of 
their  system,  are  wanting  in  American  .society,  and  consequently, 
that  any  superstructure  built  upon  them,  for  application  in  the  Uni- 
ted States,  must  fall  to  the  ground.  Set  up  a  house  on  three  abut- 
ments, and  take  away  two,  what  will  be  the  result  ?  It  is  down, 
a  heap  of  ruins.  It  will  be  sufficient  to  cite  Adam  Smith's  and 
Ricardo's  description  and  adjustment  of  these  three  fundamental 


152  THE    DIFFERENT    STATES    OF    SOCIETY 

elements,  to  indicate  what  they  are.  Smith  says:  "The  whole 
annual  produce  of  the  land  and  labor  of  every  country  naturally 
divides  itself  into  three  parts  —  the  rent  of  land,  the  wages  of  labor, 
and  the  profits  of  stock  ;  and  constitutes  a  revenue  to  three  different 
sorts  of  people  —  to  those  who  live  by  rent,  to  those  who  live  by 
wao-es,  and  to  those  who  live  by  profit-  These  are  the  three  great, 
original,  and  constituent  orders  of  every  civilized  society,  from 
whose  revenue  that  of  every  other  order  is  ultimately  derived." 

Ricardo  represents  them  thus  :  "  The  produce  of  the  earth,  all 
that  is  derived  from  its  surface  by  the  united  application  of  labor, 
machinery,  and  capital,  is  divided  among  three  classes  of  the  com- 
munity, viz.,  the  proprietor  of  the  land,  the  owner  of  the  stock  or 
capital  necessary  for  its  cultivation,  and  the  laborers  by  whose 
industry  it  is  cultivated.  .  .  The  proportions  of  the  whole  produce 
of  the  earth  w^hich  will  be  allotted  to  each  of  these  classes,  under 
the  names  of  rent,  profit,  and  wages,  will  be  essentially  different. 
.  .  To  determine  the  laws  which  regulate  this  distribution,  is  the 
principal  problem  in  political  economy." 

It  will  be  observed,  first,  that  these  views  are  limited  —  not  pro- 
found— taking  their  own  programme  as  a  rule.  "The  principal 
problem  in  public  economy,"  is  here  announced,  as  growing  out 
of  afrriculture,  as  if  the  arts  in  all  their  branches,  as  if  commerce 
and  trade,  as  if  the  fisheries,  &c.,  had  nothing  to  do  with  it ;  or  as 
if  the  subject  had  nothing  to  do  with  them.  The  leading  topics 
of  Ricardo's  work,  as  enumerated  in  his  table  of  contents,  will 
show  that  he  surveyed  but  a  limited  field  ;  and  it  will  also  be  seen 
that  most  of  those  topics  grew  out  of  a  state  of  society  which,  if  not 
entirely  unknown  in  the  United  States,  exists  only  in  small  frag- 
ments, coming  down  from  what  is  here  regarded  as  a  vicious  state 
of  society,  and  which  is  alike  repugnant  to  the  genius  of  the 
American  people  and  of  American  institutions.  Take  for  example 
the  topics  of  "Rent;"  "Taxes  on  Rent;"  "Tithes;"  "Land 
Tax  ;"  "  Taxes  on  Gold  ;"  "  Taxes  on  Houses  ;"  "  Taxes  on 
Wages  and  Profits;"  "Poor  Rates;"  "Taxes  on  Producers;" 
&c.  These,  making  more  than  a  third  of  the  chapters  of  this  work, 
are  great  practical  subjects  in  Europe.  They  enter  into  all  the 
forms  of  society  there,  and  pervade  its  entire  structure.  But  not 
so  in  the  United  States.  They  are,  for  the  most  part,  contrary  to 
the  genius  of  the  American  people,  and  too  obnoxious  to  be  intro- 
duced among  them  to  any  considerable  extent.  The  ambition  of 
every  American  citizen  is  to  be  an  independent  proprietor  of  a  free- 


IN    EUROPE    AND    AMERICA.  153 

hold  estate,  or  to  acquire  an  independence  of  some  kind  that  is  tan- 
tamount; and  the  American  people  have  the  greatest  repugnance 
to  direct  taxation.  Perhaps  not  more  than  a  moiety  of  the  subjects 
of  legislation  in  Europe,  are  subjects  of  legislation  in  the  United 
States,  and  the  other  moiety  present  themselves  in  forms  so  diverse 
in  each  quarter,  that  it  is  not  possible  to  treat  them  in  the  same  way 
for  both  hemispheres.  How,  then,  is  it  possible  that  a  system  of 
public  economy  which  is  adapted  to  the  former  sphere,  and  which 
grows  out  of  it,  should  be  adapted  to  the  latter,  when  the  very  de- 
sign of  such  a  system  is  to  give  advice  on  the  subjects  of  legisla- 
tion, and  to  suggest  forms  ? 

But  It  will  be  found,  on  an  examination  of  these  three  capital 
elements,  "  rent,  pro6t,  and  wages,"  as  presented  in  the  above 
extracts,  when  their  meaning  is  considered,  that  the  British  Free- 
Trade  economists  occupy  a  field  entirely  different  from  that  of  the 
United  States,  and  that  not  one  of  these  three  comprehensive  ele- 
ments can  be  found  among  us,  to  any  considerable  extent,  in  the 
forms  in  which  they  stood  up  before  them,  as  an  actual  state  of  so- 
ciety for  them  to  treat  of,  and  write  for.  They  divide  society  into 
"three  classes,  the  proprietor  of  the  land,  the  owner  of  the  stock 
or  capital  necessary  to  its  cultivation,  and  the  laborers  by  whose 
industry  it  is  cultivated ;"  and  in  correspondence  with  this  classifi- 
cation, they  appropriate  to  the  first  class  "  rent,"  to  the  second 
"  profit,"  and  to  the  third  "  wages."  Ricardo's  programme  con- 
cludes by  saying :  "  To  determine  the  laws  which  regulate  this 
distribution,  is  the  principal  problem  in  political  economy.' 

This,  no  doubt,  is  a  fair  description  of  the  fundamental  elements 
of  their  theory,  as  regards  both  the  premises  and  the  conclusion. 
Such  was  and  is  still  the  state  of  society  there.  The  exceptions 
they  did  not  deem  worthy  of  consideration,  and  must  take  care  of 
themselves,  or  be  left  to  the  discretion  of  legislators.  Now,  it  hap- 
pens, that  the  things  which  constitute  the  rule  in  that  state  of  so- 
ciety, are  the  exception  in  the  United  States;  and,  vice  verso,  the 
things  which  constitute  the  rule  in  the  United  States,  or  which 
ought  to  do  so,  are  the  exception  in  Great  Britain  and  in  Europe. 
For  the  most  part,  American  citizens  are  independent  proprietors  of 
the  soil,  or  of  some  equivalent ;  they  all  aim  at  this ;  and  there  is 
not  a  man  among  them  who  will  submit  to  the  abject  and  depend- 
ent condition  of  the  third  class  of  European  economists.  Ameri- 
can society  does  not  exist  in  such  forms. 

Mr.  Mill,  the  logician,  before  cited,  remarks  very  pertinently  on 


154  THE    DIFFERENT    STATES    OF    SOCIETY 

this  point :  *'  It  has  been  greatly  the  custom  of  English  political 
economists  to  discuss  the  natural  laws  of  the  distribution  of  the 
produce  of  industry,  on  a  supposition  which  is  scarcely  realized 
anywhere  out  of  England  and  Scotland,  viz.,  that  the  produce  i? 
shared  among  three  classes,  altogether  distinct  from  one  anothe', 
laborers,  capitalists,  and  landlords;  and  that  all  these  are  free  agents, 
permitted  in  law  and  in  fact  to  set  upon  their  labor,  their  capital, 
and  their  land,  whatever  price  they  are  able  to  get  for  it.  The  cion- 
clusions  of  the  science,  being  all  adapted  to  a  state  of  society  thus 
constituted,  require  to  be  revised  when  they  are  applied  to  any  other. 
They  are  inapplicable  where  the  only  capitalists  are  the  landlords, 
and  the  laborers  are  their  property,  as  in  slave  countries.  They 
are  inapplicable  where  the  universal  landlord  is  the  state,  as  in 
India.  They  are  inapplicable  where  the  agricultural  laborer  is 
generally  the  owner  both,  of  the  land  itself  and  of  the  capital,  as 
in  France  [also  in  the  United  States],  or  of  the  capital  only,  as  in 
Ireland.  It  may  be  objected  to  the  existing  race  of  economists, 
that  they  attempt  to  construct  a  permanent  fabric  out  of  transitory 
materials;  that  they  take  for  granted  the  immutability  of  arrange- 
ments of  society,  many  of  which  are  in  their  nature  fluctuating  and 
progressive,  and  enunciate  with  as  little  qualification  as  if  they  were 
universal  and  absolute  truths,  propositions  which  are  perhaps  ap- 
plicable to  no  state  of  society  except  the  particular  one  in  which 
the  writer  happened  to  live." 

Adam  Smith  saw  and  recognised  the  difference  of  land  tenures 
in  Europe  and  America;  but  still  attempted  to  force  his  principles 
on  these  different  states  of  things.  He  says  :  "  A  gentleman  who 
farms  his  own  estate,  after  paying  the  expense  of  cultivation,  should 
gain  both  the  rent  of  the  landlord  and  the  profit  of  the  farmer.  He 
is  apt,  however,  to  denominate  his  whole  gain  profit,  and  thus  con- 
founds rent  with  profit.  The  greater  part  of  our  North  American 
and  West  India  planters  are  in  this  situation.  They  farm  their  own 
estates,  and  accordingly  we  seldom  hear  of  the  rent  of  a  plantation, 
but  frequently  of  its  profit."  Adam  Smith,  like  all  of  his  school, 
insists  that  everything  in  civilization  originates  in  and  is  based  upon 
"rent,  profit,  and  wages ;"  and  where  he  can  not  find  rent,  he  says 
it  must  be  there  notwithstanding.  The  rent  of  a  farmer,  who  owns 
the  land  he  cultivates,  he  says,  is  that  part  of  his  profit  which  would 
answer  to  the  interest  of  the  cost  or  present  value  of  his  plantation. 
But  why  insist  on  calling  this  rent  ?  In  the  United  States,  where 
people,  for  the  most  part,  work  their  own  plantations  and  farms,  it 


IN    EUROPE    AND    AMERICA.  155 

is  only  an  imaginary  distinction.  In  our  state  of  society,  two  of 
the  three  great  and  fundamental  elements  of  public  econon)y  in 
Great  Britain  and  Europe,  or  which  Adam  Smith  and  his  school 
have  installed  in  this  position,  to  wit,  rent  and  profit,  disappear, 
can  not  be  found,  as  a  general  rule,  clothed  with  the  attributes  with 
which  they  have  invested  them  ;  and  even  the  third,  wages,  is  a 
very  different  thing  here.  The  whole  three,  indeed,  are  here  con- 
founded, and  merged  in  one  ;  and  where  any  things  are  found  to 
answer  to  the  theory  of  those  economists,  they  are  the  exceptions, 
not  the  rule.  Why,  then,  render  confusion  worse  confounded,  by 
attempting  to  force  on  us  a  nomenclature  of  public  economy,  when 
we  can  find  nothing  to  answer  to  these  names,  bating  only  excep- 
tions to  general  rules  ?  For  the  most  part,  ours  is  a  different  world 
from  theirs.  Things  here  started  different,  have  grown  up  differ- 
ent, and  are  different.  Even  the  things  among  us,  which  they  tried 
to  make  like  unto  theirs,  while  they  governed  us,  we  have  greatly 
modified  since  we  became  independent.  It  is  impossible  for  an 
American  even  to  understand  European  economists,  while  writing 
and  expounding  their  theory  of  *'  rent,  profit,  and  wages,"  unless 
he  puts  himself  to  the  trouble  of  becoming  familiar  with  their  social 
and  political  history,  running  back  for  centuries.  Their  nomen- 
clature is  unintelligible  here,  simply  because  it  does  not  apply  to 
things  with  which  Americans  are  acquainted.  How  absurd,  then, 
to  force  it  on  things  which  do  not  exist  in  any  forms  to  be  recog- 
nised under  such  names?  We  have,  indeed,  things  called  rent, 
profit,  and  wages  ;  but  we  have  no  such  system,  as  European  econ- 
omists apply  these  terms  to  ;  and  it  is  impossible  they  should  be  ap- 
plied here,  in  the  same  sense  in  which  they  apply  there,  without 
leading  to  error. 

M.  Say  has,  also,  very  naturally  recognised  the  absence,  in 
America,  of  one  of  the  three  great  elements  of  public  economy 
in  Europe,  in  the  following  passage:  "  Families,  transplanted  from 
a  civilized,  to  an  entirely  new  country,  carry  with  them  theoretical 
and  practical  knowledge,  which  is  one  of  the  chief  elements  of  pro- 
ductive industry.  They  carry,  likewise,  habits  of  industry,  cal- 
culated to  set  these  elements  in  activity,  as  well  as  the  habit  of 
subordination,  so  essential  to  the  preservation  of  social  order. 
They  commonly  take  with  them  some  little  capital,  also,  not  in 
money,  but  in  tools  and  stock  of  different  kinds.  Moreover,"  he 
says,  "  they  have  no  landlord  to  share  the  produce  of  a  virgin  soil, 
far  exceeding  in  extent  what  they  are  able  to  bring  into  cultivation 


156  THE    DIFFERENT    STATES    OF    SOCIETY 

for  years  to  come."  Along  with  tliis  absence  of  land-lordism,  or 
rent,  comes  also,  and  necessarily,  the  absence  of  another  of  the 
three  great  elements  of  the  European  system,  which  they  call 
profit,  and  which  refers  exclusively  to  the  position  and  interest  of 
the  capitalist,  or  farmer,  who  stands  between  the  landlord  and  the 
laborers.  It  must  be  seen,  therefore,  that  the  second  of  these 
elements  supposes  the  first,  and  that,  without  the  first,  the  second  can 
not  exist.  Consequently,  two  of  the  three  great  elements  of  public 
economy  in  Europe,  particularly  as  laid  down  by  British  Free- 
Trade  writers,  are  wanting  here.  It  would,  therefore,  be  absurd 
to  suppose,  that  a  system  founded  upon  and  growing  out  of  these 
three  elements,  could  be  adapted  to  a  state  of  society,  where  two 
of  the  three  are  wanting,  and  where  the  three  are  merged  in  one. 
The  result  is  simply  this :  That  a  superstructure  built  on  three 
supports,  can  not  stand,  if  two  be  taken  away.  In  the  United 
States,  these  three,  as  a  general  rule,  are  merged  in  one,  and 
the  plan  of  the  architect  must  be  formed  anew,  and  adapted  to 
his  foundation. 

Though  the  ancient  system  of  European  society  is  commonly 
supposed  to  have  been  broken  up,  it  is  only  a  change  of  form.  It 
may,  indeed,  have  been  alleviated.  But  the  image  of  it  remains 
distinctly  traced  in  the  theory  of  society  presented  by  British  and 
other  European  economists,  as  composed,  fundamentally,  of  land- 
lords, farmers,  and  laborers,  or  "  rent,  profit,  and  wages."  They 
suppose  that  the  land  is  owned  by  one  class,  who  receive  "  rent" 
for  it;  that  it  is  cultivated  by  another  class,  called  farmers  under 
their  system,  who  have  capital  enough  to  stock  it,  provide  imple- 
ments, and  hire  laborers,  and  whose  business  is  that  of  super- 
intendence ;  and  that  it  is  worked  by  a  third  class,  formerly  called 
"  villains,"  now  designated  by  the  name  of  laborers,  but  whose 
wages  are  only  enough  for  bare  subsistence,  such  as  is  provided 
for  the  ox  or  the  horse.  Such  are  their  fundamental  elements  for  a 
system  of  public  economy.  They  provide  nothing  for  labor  but 
subsistence,  and  the  least  possible  that  will  answer  that  end.  They 
do  not  consider  that  labor  is  entitled  to  anything  more.  It  never 
entered  their  heads,  that  labor  might  aspire  to  independence,  to 
proprietorship,  even  to  affluence.  They  consider  that  God,  or 
society,  has  given  the  land  to  one  class  ;  that  an  intermediate  class 
are  to  take  care  of  it,  and  support  the  first  class ;  and  that  a  third 
and  abject  class,  born  to  toil,  and  nothing  else,  are  to  do  all  the 
work,  and  support  the  other  two  classes,  receiving  just  enough  to 


IN    EUROPE    AND    AMERICA.  157 

give  them  strength  to  do  the  greatest  service,  in  the  same  manner 
as  a  man  feeds  his  ox  or  his  horse,  and  for  the  same  object.  Such 
was  the  old  system  of  Europe  ;  such,  virtually,  is  its  system  at  this 
day,  particularly  in  Great  Britain.  Such  is  the  system  of  Adam 
Smith,  Ricardo,  Say,  M'Culloch,  and  others. 

Hear  Adam  Smith  on  this  point:  "  A  man  must  always  live  by 
his  work,  and  his  wages  must,  at  least,  be  sufficient  to  maintain 
him.  They  must  even,  upon  some  occasions,  be  somewhat  more; 
otherwise,  it  would  be  impossible  for  him  to  bring  up  a  family,  and 
the  race  of  such  workmen  would  not  last  beyond  the  first  genera- 
tion. Mr.  Cantillon  [one  of  the  British  economists]  seems,  upon 
this  account,  to  suppose  that  the  lowest  species  of  common  laborers 
must  everywhere  earn  at  least  double  their  own  maintenance,  in 
order  that,  one  with  another,  they  may  be  enabled  to  bring  up 
two  children  ;  the  labor  of  the  wife,  on  account  of  her  necessary 
attendance  on  the  children,  being  supposed  no  more  than  sufficient 
to  provide  for  herself.  But  one  half  the  children  born,  it  is  com- 
puted, die  before  the  age  of  manhood.  The  poorest  laborers, 
therefore,  according  to  this  account,  must,  one  with  another,  at- 
tempt to  raise  at  least  four  children,  in  order  that  two  may  have 
an  equal  chance  of  living  to  that  age.  But  the  necessary  mainten- 
ance of  four  children,  it  is  supposed,  may  be  nearly  equal  to  that 
of  one  man.  The  labor  of  an  able-bodied  slave,  the  same  author 
[Cantillon]  adds,  is  computed  to  be  worth  double  his  maintenance; 
and  that  of  the  meanest  laborer,  he  thinks,  can  not  be  worth  less 
than  that  of  an  able-bodied  slave.  Thus  far,  at  least,  seems  cer- 
tain, that,  in  order  to  bring  up  a  family,  the  labor  of  the  husband 
and  wife  together  must,  even  in  the  lowest  species  of  common 
labor,  be  able  to  earn  something  more  than  what  is  precisely  neces- 
sary for  their  own  maintenance;  but  in  what  proportion,  whether 
in  that  above  mentioned,  or  in  any  other,  I  shall  not  take  upon  me 
to  determine."     Thus  Adam  Smith. 

It  can  not  be  denied,  that  this  is  a  very  nice,  close  calculation ; 
and  it  will  be  observed,  that  the  case  of  the  slave  is  brought  in  as 
the  measure  of  economy  in  the  case  !  All  that  is  proposed,  thought 
of,  is,  that  the  race  of  laborers  shall  have  enough  to  perpetuate 
themselves,  '*  lest  they  should  not  last  beyond  the  first  generation." 
Is  it  possible,  that  these  givers-out  of  law  for  the  social  state  could 
enter  into  such  a  conspiracy  against  the  rights  o(  mankind  ?  Such, 
undoubtedly,  is  the  fact. 

Hear,  also,  M.  Say  on  this  point :  '*  Simple  or  rough  labor  may 


158  THE    DIFFERENT    STATES    OF    SOCIETY 

be  executed  by  any  man  possessed  of  life  and  health.  Wherefore^ 
bare  existence  is  all  that  is  requisite  to  insure  a  supply  of  that  class 
of  industry.  Consequently,  its  wages  seldom  rise,  in  any  country, 
much  above  what  is  absolutely  necessary  to  subsistence ;  and  the 
quantum  of  supply  always  remains  on  a  level  with  the  demand  ; 
nay,  often  goes  beyond  it.  Wherever  the  mere  circumstance  of 
existence  is  sufficient  for  the  execution  of  any  kind  of  work,  and 
that  work  affords  the  means  of  supporting  existence,  the  vacuum 
is  speedily  filled  up.  .  .  In  this  class  of  life,  the  wages  are  some- 
what more  than  is  necessary  for  bare  personal  existence  ;  they  must 
be  sufficient  to  maintain  the  children  of  the  laborer  also.  If  the 
wages  of  the  lowest  class  of  labor  were  insufficient  to  maintain  a 
family,  and  bring  up  children,  its  supply  would  never  be  kept  up 
to  the  complement.  .  .  A  full-grown  man  [a  rough  laborer]  is  an 
accumulated  capital ;  the  sum  spent  in  rearing  him,  is  indeed  con- 
sumed ;  but  consumed  in  a  reproductive  way,  calculated  to  yield 
the  product  man.  .  .  To  those  whose  whole  income  is  a  bare  sub- 
sistence, a  fall  of  wages  is  an  absolute  death-warrant,  if  not  to  the 
laborer  himself,  to  a  part  of  liis  family  at  least." 

It  is,  then,  confessedly,  an  element  of  their  system,  that  "  a  fall 
of  wages  is  an  absolute  death-warrant,  either  to  the  laborer,  or  a 
part  of  his  family  !" 

Hear,  also,  M'Culloch  :  "  There  does  not  seem  to  be  any  good 
reason  why  man  himself  should  not,  and  very  many  why  he  should, 
be  considered  as  forming  a  part  of  the  national  capital."  That  is, 
the  bones  and  sinews  of  the  laboring  classes,  in  the  same  manner 
as  slaves,  are  always  classed  with  chattel  property.  It  is  obvious, 
that  M'Culloch  could  not  mean  anything  else.  For  they  who  do 
not  work,  who  are  not  producers,  are  consumers,  and  could  not  be 
viewed  in  the  light  of  capital,  in  the  eyes  of  an  economist. 

We  have,  then,  in  the  above-cited  passages  from  Smith,  Say, 
and  M'Culloch,  an  explanation  of  what  Ricardo  means  by  the  fol- 
lowing part  of  the  citation  already  made  from  him  :  "  The  propor- 
tions of  the  whole  produce  of  the  earth,  which  will  be  allotted  to 
each  of  these  classes,  under  the  names  of  rent,  profit,  and  wages, 
will  be  essentially  different."  How  and  for  what  reason  different? 
Which  of  these  classes  is  to  be  the  favored  one?  Or  which  two 
of  them?  Which  is  to  be  the  most,  and  which  the  least,  favored? 
An  "  essential  difference"  is  announced.  This  is  a  strong,  an 
emphatic  expression,  composing  a  part,  an  element,  o{  a  plan  of 
society,  of  a  system  of  public  economy,  unblusbingly  proposed  to 


IN    EUROPE    AND    AMERICA.  159 

the  world,  not  only  as  a  real  state  of  things,  existing  from  time 
immemorial,  and  then  existing,  but  to  exist  for  ever,  without 
remedy,  or  the  hope  of  it !  The  landlord  is  to  get  the  principal 
part ;  his  farmer,  or  the  capitalist  who  hires  the  farm,  and  pays  the 
rent,  is  to  come  next  for  his  share,  in  the  shape  of  profit ;  and  what 
is  the  portion  of  the  laborer,  under  this  system"?  The  same  as  that 
of  the  ox  or  horse  that  drags  the  plough  or  the  harrow — just  enough 
to  keep  him  in  the  most  fit  state  to  work.  That  is  all  this  system 
has  ever  yet  done  ;  it  is  all  it  ever  intended  to  do  ;  it  is  all  it  ever 
will  do,  till  Europe  is  reyolutionized ;  it  is  all  that  these  economists 
have  ever  thought  of — all  they  have  provided  for  in  their  systems. 

Mr.  Malthus's  theory  of  population,  which  is  generally  respected 
in  Europe,  particularly  in  Great  Britain,  explains  all  this.  He 
thinks  men  multiply  faster  than  there  is  room,  work,  and  food,  for 
them  ;  that  the  masses  will  fight  against  each  other  for  employment 
to  support  life  ;  that  landlords,  and  all  capitalists,  may  rely  on  this 
natural  strife,  among  laborers,  in  bidding  for  the  lowest  wages  that 
will  support  existence;  and  as  a  consequence,  resulting  from  this 
theory,  it  may  be  assumed,  that  the  natural  increase  of  the  human 
family  is  not  a  blessing,  but  a  curse,  to  the  majority  of  the  race ; 
and  that  the  masses  are  doomed  by  Providence,  to  degradation,  to 
a  state  of  serfdom  or  slavery,  to  want  and  wretchedness,  whhout 
hope  or  possibility  of  relief. 

Ratiier  than  be  guilty  of  this  libel  on  Providence — it  is  indeed 
a  very  grave  and  impious  one — it  would  have  been  much  more 
consistent  with  Christian  piety,  and  with  the  Christian  doctrine  of 
morals,  it  may  be  said  more  philosophical,  to  assume  a  defect  in 
society.  It  is  shocking  to  ascribe  such  a  want  of  wisdom  and 
goodness  to  the  Creator !  Mr.  Malthus  supplies  in  theory  what 
was  wanted  to  sustain  the  practice  of  the  European  world,  to  wit, 
the  hopeless  degradation  and  misery  of  the  masses ;  and  the  Eu- 
ropean economists  of  the  Free-Trade  school  assume  the  fact  as  a 
postulate,  putting  it  in  the  place  of  one  of  the  foundation-stones  of 
their  edifice!  They  are  not  ashamed  to  do  this  openly  —  to  make 
it  visible,  prominent,  staring  out  in  the  face  of  man  and  of  heaven. 
This  theory,  recognised  and  reduced  to  practice  in  society,  is  an 
insuperable  bar,  a  yoke  that  can  not  be  broken,  an  iron  despotism 
over  the  masses  of  mankind. 

This  extreme  necessity  of  man,  resulting  from  Malthus's  theory, 
which  dooms  the  masses  to  work  for  bare  subsistence,  the  Hon. 
Mr.  Appleton   (Nathan)  says,  is  taken  by  the  modern  school  of 


160  THE    DIFFERENT    STATES    OF    SOCIETY 

economists,  "  sucli  as  M'CuUoch,  Ricardo,  and  others,  as  the 
natural  rate  of  wages.  This  low  and  abject  state  of  labor,"  he 
says,  "  is  the  original  principle  from  which  they  have  drawn  most 
important  conclusions  as  to  the  foundation  of  their  system,  it  being 
admitted  [by  them]  that  profits  go  wholly  to  the  owners  of  capital 
employing  labor,  and  no  part  of  the  accumulation  to  the  laborers 
themselves." 

It  may,  therefore,  be  assumed  as  a  fact,  involving  a  fundamental 
element  in  the  system  of  the  Free-Trade  economists,  and  pervading 
every  part  of  it,  that  the  masses  of  mankind  are  to  be  regarded  as 
mere  working  machines  for  the  benefit  of  the  few,  with  no  other 
cost  than  to  be  kept  in  the  best  working  order.  Such  an  element 
of  public  economy,  lying  at  the  foundation  of  a  system,  being  as 
one  to  three  of  the  capital  parts,  stops  nowhere  in  its  influence  and 
control  over  the  various  subdivisions  and  ramifications  of  that  sys- 
tem. The  only  thing  that  remains  the  same,  is,  the  position,  the 
necessity,  the  hopeless  doom  of  this  working  machine. 

If  it  should  be  said  that  some  measure  of  political  freedom  has 
been  granted  to  the  working  classes  in  Great  Britain,  and  in  some 
other  states  of  Europe,  it  amounts  to  very  little  upon  examination, 
and  is  rather  a  mockery  of  their  condition,  than  a  ground  of  hope 
for  future  emancipation,  under  such  a  recognised  system  of  public 
economy,  as  above  described,  in  perpetual  and  full  operation. 
The  number  of  freemen  entitled  to  the  elective  franchise  among 
the  laborers  of  Great  Britain,  is  very  small,  even  under  their 
boasted  reform  bill ;  and  their  position,  as  electoi-s,  is  not,  to  any 
considerable  extent,  independent.  They  are  for  the  most  part 
under  the  influence  of  their  employers,  in  the  use  of  this  privilege, 
which  renders  it  of  little  avail  to  them  as  a  political  right.  But 
the  entire  disqualification  of  the  great  masses  of  the  toiling  millions 
of  Great  Britain,  which  is  generally  allowed  to  have  more  freedom 
than  any  other  country  in  Europe,  is  an  insuperable  obstacle  to 
their  emancipation.  Some  of  the  smaller  European  states  have, 
indeed,  a  semblance  of  freedom  ;  but  even  that  amounts  to  but  little 
in  the  general  reckoning,  and  the  cases  are  so  isolated  and  walled 
in  by  opposing  barriers,  as  to  amount  to  much  less  in  their  influence. 
No  promise  has  ever  yet  dawned  on  that  vast  domain  of  the  civil- 
ized world,  that  is  likely  to  disturb  the  doctrine  of  the  economists 
in  that  quarter,  or  to  require  a  new  classification  of  the  human  race 
in  their  system.  The  landlord  and  his  rent,  the  capitalist  and  his 
profit,  the  laborer  and  his  food,  seem  likely  to  continue  for  ages  in 


IN    EUROPE    AND    AMERICA.  161 

the  same  relations  to  each  other,  with  the  same  apportionment  of 
the  goods  of  this  hfe,  "  essentially  different,"  the  third  having  no 
political  influence,  and  few  of  them  any  poUtical  rights  what- 
ever. 

The  prevalent  principle  of  land  tenures  in  Europe,  together 
with  the  principle  on  which  land  was  originally  distributed,  in  con- 
stituting the  foundation  of  the  present  state  of  society  there,  seems 
to  lie  at  the  foundation  of  the  Free-Trade  system  of  public  econ- 
omy. Look  at  the  three  great  parts  of  that  system,  "  rent,  profit, 
and  wages." 

The  original  and  fundamental  principle  of  land  tenures  in  Great 
Britain,  seems  to  be  that  they  are  held  of  the  crown  ;  that  in  look- 
ing backward,  the  crown  is  a  ve  yJus  ultra  seignory,  as  a  sovereio^n 
corporation  of  and  by  itself;  that,  except  crown-lands  reserved, 
the  territory  was  distributed  among  and  bestowed  upon  the  nobles 
by  the  sovereign,  under  royal  patents,  or  some  appropriate  instru- 
ments of  conveyance  ;  that  most  of  the  lands  have  so  descended ; 
and  that  the  changes  of  modern  times  have  not  essentially  dis- 
turbed this  state  of  things.  The  principal  land-owners  of  Great 
Britain,  even  now,  do  not  exceed  some  thirty  odd  thousand,  in  a 
population  of  twenty-eight  millions.  In  the  monarchical  countries 
of  Europe,  which  comprehend  most  of  its  territories,  the  principle 
of  land  tenures  is  substantially  the  same  as  in  Great  Britain,  how-  § 

ever  it  may  run  into  difi'erent  forms  of  application.     Hence  a  sys-  "v 

tem  of  public  economy  growing  out  of  such  a  state  of  things,  and  ^ 

adapted  to  it,  begins  with  this  first  principle,  and  is  controlled  by 
its  influence  throughout. 

The  following  definition  of  "rent,"  by  Adam  Smith,  is  a  very 
instructive  comment  on  the  bearings  of  British  and  other  European 
land  tenures  :  — 

"  Rent,  considered  as  the  price  paid  for  the  use  of  land,  is  natu- 
rally the  highest  which  the  tenant  can  afford  to  pay,  in  the  actual 
circumstances  of  the  land.  In  adjusting  the  terms  of  the  lease, 
the  landlord  endeavors  to  leave  him  no  greater  share  of  the  produce 
than  what  is  sufficient  to  keep  up  the  stock  [capital]  from  which 
he  furnishes  the  seed,  pj>ys  the  labor,  and  purchases  and  maintains 
the  cattle  and  other  instruments  of  husbandry,  together  with  the 
ordinary  profits  of  farming  stock  [capital]  in  the  neighborhood. 
This  is  evidently  the  smallest  share  with  which  the  tenant  can  pos- 
sibly content  himself,  without  being  a  loser;  and  the  landlord  sel- 
dom means  to  leave  him  any  more." 

11 


162  THE    DIFFERENT    STATES    OF    SOCIETY 

It  will  be  seen,  again,  that  this  is  a  pretty  close  calculation,  as  it 
bears  on  the  tenant,  or  the  farmer  as  he  is  called  in  England,  which 
does  not  mean  exactly  the  same  as  in  the  United  States.  In  every 
new  lease,  the  English  landlord  is  as  much  in  the  market  with  his 
land,  to  get  the  most  he  can  for  it,  according  to  the  principles  laid 
down  in  the  above  definition  of  Adam  Smith,  as  his  tenant  is  with 
his  produce;  and  he  will  take  advantage  of  every  new  adventitious 
value.  He  may  sometimes  lose  by  this  principle;  but  in  a  thriving 
country,  he  generally  gains.  When  a  landlord  finds  seaweed 
thrown  up  by  the  tides  on  the  shore  that  borders  his  land,  though 
furnished  by  Providence,  and  falling  not  within  his  patent,  he  nev- 
ertheless taxes  his  tenant  for  its  value  as  a  raw  material  for  purposes 
of  manure.  The  barren  rocks  of  the  Shetland  Islands  are  taxed 
with  rent  for  every  fisherman's  hut —  not  for  the  value  of  that  which 
is  above  the  tide,  but  according  to  the  value  of  that  which  the 
hardy  fishermen,  in  their  perilous  expeditions,  draw  up  from  the 
deep  blue  sea.  They  must  live,  and  bring  their  produce  on  shore. 
But  they  must  pay  the  landlord's  rent,  which  is  graduated  by  the 
excess  of  the  productive  wealth  of  the  sea,  above  the  fisherman's 
necessities  !  Large  parts  of  the  British  metropolis  are  now  stand- 
ing on  the  estates  of  British  noblemen,  and  yield  a  rent  corre- 
sponding with  their  value  at  the  time  of  the  latest  lease. 

The  annual  income  of  the  duke  of  Sutherland  is  ,£360,000,  or 
$1,742,240;  that  of  the  duke  of  Northumberland,  £300,000,  or 
$1,452,000;  that  of  the  marquis  of  Westminster,  £230,000,  or 
$1,355,200  ;  that  of  the  duke  of  Buccleugh,  £250,000,  or 
$1,210,000.  The  English  nobility  alone,  numbering  about  400 
peers,  not  including  Irish  and  Scotch,  receive  an  annual  income  of 
£5,400,000,  or  $26,026,000.  The  annual  income  of  the  English 
gentry,  not  reckoning  Irish  and  Scotch,  including  baronets,  knights, 
country  and  other  gentlemen,  is  £53,000,000,  or  $256,250,000, 
or  more  than  one  sixth  of  the  aggregate  income  of  all  classes  of 
the  British  empire,  England,  Ireland,  and  Scodand,  which  is  about 
£300,000,000,  or  $14,520,000,000.  The  civil  list  or  annual 
appropriations  for  the  royal  household,  fixed  on  William  IV.,  was 
£510,000,  or  $2,468,400.  This  grant  to  William  IV.,  was  a 
reform  ;  as  it  appears  that  the  annual  average  of  the  civil  list,  from 
1760,  the  accession  of  George  III.,  to  the  demise  of  George  IV., 
was  £1,315,000,  or  $6,364,600.  The  annual  income  of  persons 
employed  under  the  British  government  is  £6,830,000,  or 
$34,673,200. 


IN    EUROPE    AND    AMERICA.  163 

The  above  examples  of  income  are  sufficient  to  show  how  the 
wealth  of  Great  Britain  is  chiefly  absorbed  by  royalty,  government, 
the  nobility,  and  the  higher  classes.  The  fact  that  the  common 
measure  of  private  wealth  in  England,  is  a  reference  to  the  "  rent 
roll,"  is  sufficient  evidence  of  the  relative  and  comparative  im- 
portance that  has  ever  been  attached  to  it,  in  that  state  of  society. 

When  it  is  considered  that  this  principle  of  rent  pervades  the 
entire  system  of  British  civil  polity,  under  which  the  superior 
classes  live  on  their  incomes  from  land  and  other  properties,  while 
a  second  and  intermediate  class,  with  a  capital  of  their  own,  super- 
intend and  husband  these  properties  of  whatever  description,  land  or 
other,  to  make  all  they  can  out  of  them,  after  paying  their  rent,  or 
its  equivalent  under  some  other  name,  it  may  easily  be  conceived 
how  this  superincumbent  weight  of  society,  with  all  the  power  in  its 
hands,  bears  down  on  the  substratum  of  the  laboring  classes.  The 
first  two  classes  leave  nothing  for  the  third,  as  has  been  seen,  but 
that  which  is  necessary  to  support  existence,  and  continue  the  race 
of  laborers.  It  is  not  considered  that  anything  more  is  suitable  — 
certainly  not  required.  The  laboring  classes  are  not  only  consid- 
ered as  born  to  that  portion,  but  they  consider  themselves  as  born 
to  it.  They  do  not  aspire,  they  have  not  the  moral  courage  to 
attempt  to  burst  the  chains  that  bind  them.  From  generation  to 
generation,  for  centuries,  it  has  been  so,  and  it  is  —  no  doubt  with 
a  moral  certainty  —  regarded  as  a  reliable  element  of  public  econ- 
omy. Every  British  Free-Trade  economist  speaks  of  it  as  such, 
assumes  the  fact,  incorporates  it  in  his  system  in  one  uniform  shape, 
and  it  does  not  seem  to  be  regarded  as  susceptible  of  any  essential 
modification.  Not  even  a  contingency  is  attached  to  it;  but  it  is 
put  down  as  a  fixed  and  permanent  fact,  that  the  masses  are  born  to 
serve  the  few,  and  to  serve  them  as  masters,  in  whose  power  they 
are,  and  from  which  they  can  never  escape. 

It  has  already  been  suggested,  that  this  state  of  things  is  the  re- 
sult of  an  original,  primary  principle  —  "rent."  Modern  changes 
in  society  have  indeed  imparted  to  it  some  new  modifications,  as  to 
the  mode  of  its  operation,  and  as  to  the  hands  in  which  the  power 
is  vested.  In  Great  Britain  especially,  what  are  commonly  called 
"  the  middle  classes,"  have  for  a  long  time  been  creeping  upward 
by  the  augmentation  of  wealth  among  those  engaged  in  commerce, 
in  the  trades,  and  in  manufactures.  Wealth  gives  power  and  con- 
sequence ;  it  becomes  possessed  of  lands  and  fixed  estates ;  it  as- 
pires to  recognition  in  the  higher  circles  of  society  ;  ultimately  it 


164  THE    DIFFERENT    STATES    OF    SOCIETY 

• 

gains  a  standing,  in  the  case  of  men  of  acknowledged  worth  and 
talents  ;  it  steps  into  the  condition  of  gentlemen,  which  is  a  class  ; 
and  at  last  some  arrive  at  the  highest  honors  of  the  state,  and  are 
perhaps  installed  among  the  peers  of  the  realm.  But  as  they  rise 
in  the  world,  they  imbibe  the  spirit  of  every  superior  station  to 
which  they  may  have  attained,  and  are  more  jealous  of  the  prerog- 
atives of  class  than  those  who  are  born  to  them.  The  substratum 
from  which  they  have  emerged  gains  nothing  by  their  ascent,  but 
rather  loses.  They  do  not  lift  others  up,  but  seek  to  keep  them 
down  ;  and  still  the  old  principles  of  proprietorship,  tenancy,  and 
villanage,  prevail.     The  working  classes  are  doomed. 

It  is  quite  unnecessary  to  say,  on  American  soil,  and  under  the 
shadow  of  x\merican  institutions,  that  American  society  is  directly 
opposed  to  this.  With  few  exceptions,  and  those  very  limited  in 
extent,  the  occupancy  and  use  of  the  soil  of  the  country  are  not 
under  the  tenure  of  rent ;  and  the  troubles  that  have  risen  in  the 
state  of  New  York,  on  account  of  it,  are  sufficient  evidence  of  the 
innate  opposition  that  exists  to  this  system  in  the  feelings  of  the 
people.  And  yet,  as  practised  here,  in  the  cases  above  alluded  to, 
it  is  a  very  different  thing  from  the  tenure  of  rent  as  it  is  made  to 
operate  in  Great  Britain  and  in  Europe.  We  are  not  aware,  that 
the  obnoxious  principles  recognised  in  Smith's  definition  of  rent, 
above  cited,  have  been  attempted  to  be  put  in  force,  in  this  coun- 
try, by  landlords.  On  the  contrary,  the  terms  of  rent  remain  the 
same  as  originally  stipulated  ;  whereas  Adam  Smith  says,  that  "the 
rent  of  an  estate  [in  Great  Britain]  commonly  amounts  to  what  is 
supposed  to  be  a  third  of  its  gross  produce."  He,  moreover,  has 
occasion  to  represent  very  frequently,  on  this  topic,  that  all  the  in- 
creased values  of  an  estate,  by  time,  culture,  and  any  adventitious 
cause  whatever,  go  to  the  landlord  —  are  appropriated  by  him. 
Neither  the  tenant,  nor  the  laborer,  gets  any  benefit. 

In  the  United  States,  the  people  hold  land  and  other  property, 
not  of  the  seignory  of  a  crown,  but  of  themselves,  as  a  voluntary 
corporation  existing  in  the  form  of  a  commonwealth,  and  the  indi- 
vidual rights  of  soil  generally  vest  in  the  proper  persons  of  individ- 
uals, without  any  superior.  The  aim,  ambition,  pride  of  the  Amer- 
ican people,  tends  toward  proprietorship,  be  it  of  a  larger  or  smaller 
domain  ;  be  it  of  a  great  or  little  amount  of  property ;  be  it  of  a 
costly  mansion  or  an  humble  cabin  ;  be  it  a  fisherman's  boat,  or  a 
horse,  or  a  cow,  or  a  dog  and  rifle.  In  other  words,  it  is  the  spirit 
of  independence,  which  they  cherish.     This  is  the  genius  of  the 


IN    EUROPE    AND    AMERICA.  165 

people,  of  their  institutions,  of  the  government ;  and  from  the  foun- 
dation to  the  top  stone  of  the  social  edifice,  it  is  a  perfect  contrast 
to  the  state  of  society  in  Europe.  And  Americans  can  afford  it; 
it  is  in  their  power  to  be  independent.  Ages,  all  time  may  roll 
away,  before  it  is  likely  that  one  American  will  be  able  to  force  an- 
other into  his  service,  from  the  necessity  of  the  latter,  and  dictate  his 
wages. 

It  must  be  obvious,  that  such  a  state  of  society  can  not  be  thrown 
out  of  consideration,  in  the  construction  of  a  system  of  public  econ- 
omy for  it,  if  it  is  to  be  adapted  to  it ;  nor  can  it  be  said,  that  these 
are  not  elements.  They  are  fundamental  elements.  All  the  Brit- 
ish and  other  European  economists  begin  with  these  very  things, 
in  forming  the  foundations  of  their  respective  systems  ;  or  rather 
with  the  things  which  occupy  these  places  —  different,  indeed,  from 
those  found  in  the  United  States,  as  can  well  be  imagined.  Here, 
laboring  men  work  for  themselves  in  all  cases,  and  for  wages  in 
which  they  have  an  equal  voice,  and  can  refuse  without  starving, 
or  being  reduced  to  want ;  for  there  is  always  some  alternative  open 
before  them.  They  can  always  retire  on  the  unoccupied  lands  of 
the  West,  and  be  independent.  This  chance  for  ever  secures  their 
independence.  But,  for  the  most  part,  in  the  United  States,  the 
working  men  are  found  cultivating  their  own  lands ;  or  working  in  ^1/ 
their  own  shops;  or  husbanding  pursuits,  in  which  they  are  masters 
and  proprietors ;  and  most  of  those  who  work  on  hire,  for  wages, 
do  it  not  only  to  acquire  capital  to  set  up  for  themselves,  and  on 
such  terms  as  will  enable  them  to  do  it.  Whether  working  on  wa- 
ges, or  on  their  own  estates,  they  are  independent.  They  are  lords 
of  their  own  position  and  destiny.  It  is  this  independent  position 
of  the  American  people  which  constitutes  one  of  the  most  important 
elements  of  a  system  of  public  economy  adapted  to  them,  in  the 
same  manner  as  European  economists  have  deemed  it  pertinent 
and  imperative  to  go  back  to  the  foundation  of  society,  and  take 
things  as  they  find  them  in  their  origin  and  history. 

It  would  appear  that  Adam  Smith  himself  recognised,  at  least  in 
principle  and  in  some  degree,  this  fundamental  difference  of  soci- 
ety in  Europe  and  America,  when  he  speaks  of  "  planters  in  Amer- 
ica as  being  generally  both  farmers  and  landlords,  where  rent  is 
consequently  confounded  with  profit." 

No  such  state  of  society  as  that  for  which  Adam  Smith,  Ricardo, 
and  Say  wrote,  is  found  in  the  United  States,  and  it  would  not  be 
tolerated  here  for  a  moment.    It  is,  indeed,  that  very  state  of  thmgs 


166  THE    DIFFERENT    STATES    OF    SOCIETY 

that  was  forsworn  in  the  American  revolution,  and  against  which 
the  new  government,  institutions,  and  laws,  set  up  at  that  epoch, 
and  afterward  matured  and  permanently  established,  were  expressly 
framed  to  guard,  and  guard  for  ever,  with  jealous  care,  that  they 
should  never  obtain  footing  again  on  American  soil.  This  new 
and  reformed  state  of  society,  commonly  and  not  inaptly  called  re- 
publicanism, rejects  with  indignation  and  scorn  the  idea  of  those 
relations  which  constitute  the  basis  of  the  system  of  Smith,  Ricardo, 
Say,  M'Culloch,  and  others  of  that  school.  It  was  natural  enough, 
it  may  be  said  it  was  necessary,  at  least  apparently  unavoidable, 
that  they  should  take  such  premises  as  they  were  furnished  with, 
on  which  to  erect  their  edifice.  It  is  evident  what  those  premises 
were,  because  they  are  distinctly  laid  down,  as  observed  in  the 
foregoing  citations  frora  them  ;  and  it  is  also  evident  that  a  system 
built  upon  such  premises,  must  also  correspond  with  them.  But 
the  American  system  is  directly  the  opposite  of  this.  Tliere  is  no 
resemblance  in  the  premises,  and  none  in  the  structure  raised  upon 
them,  if  it  be  properly  built. 

Nor  does  it  avail  to  say,  that  we  make  more,  in  our  argument, 
of  the  social  state,  than  we  are  entitled  to  make,  on  such  a  subject 
as  that  of  public  economy,  which  it  will,  perhaps,  be  said,  is  of  a 
commercial  rather  than  of  a  social  character.  For  it  may  be  ob- 
served in  reply,  that  these  Free-Trade  economists  do  themselves 
start  on  the  social  relations  as  a  basis,  and  very  properly  so,  because 
out  of  these  relations  come  these  commercial  results,  the  causes, 
combinations,  and  couree  of  which,  it  is  the  main  design  of  public 
economy  to  expound.  On  this  great  theme,  it  is  in  vain  to  attempt 
to  separate  the  moral  from  the  physical,  and  the  social  from  the 
commercial.  Certainly  there  is  no  demand  for  it,  since  no  party  in 
this  debate  has  ever  set  the  example.  It  is  the  original  frame,  and 
the  subsequent  legislation  of  a  comm^onwealth,  that  make  it  pros- 
perous or  otherwise  ;  and  prosperity,  used  in  such  a  connexion,  it 
is  not  denied,  is  a  commercial  term. 

What  we  have  to  say,  then,  in  elucidation  of  the  American  sys- 
tem, as  it  appertains  to  this  point,  and  in  contradistinction  from  the 
system  of  the  economists  above  cited,  is,  that  the  former  is  opposed 
to  the  latter :  opposed  in  the  original  elements  of  the  social  state ; 
opposed  in  the  organization  of  those  elements  ;  opposed  in  the  main 
objects  of  such  organization ;  and  opposed  in  its  grand  results,  moral, 
political,  and  commercial.  As  it  can  not  be  denied,  that  the  com- 
mercial results  are  the  ultimate  objects  which  most  concern  all  par- 


IN    EUROPE    AND    AMERICA.  167 

ties,  as  well  as  that  they  are  the  great  aims  of  public  economy,  so 
neither  can  it  be  denied,  that  they  are  influenced  and  controlled  by 
social  organization  ;  and  it  is  this  controlling  power  which  renders 
it  necessary  to  erect  an  American  system  of  public  economy  on  the 
American  basis. 

After  the  descent  of  the  barbarians  of  the  north,  on  the  west  and 
south  of  Europe,  the  old  state  of  society  was  broken  up,  and  re- 
mained in  confusion  for  several  centuries  ;  but  finally  settled  down 
into  the  feudal  system  under  the  usurpation  of  chiefs  or  leaders,  as 
lords  of  the  territory,  marked  out  by  consent,  or  determined  by 
strife.  Out  of  this  state  of  things  grew  up  a  more  audacious  usur- 
pation, in  the  shape  of  the  present  comprehensive  estates  of  Europe, 
called  monarchies,  kingdoms,  and  empires  —  most  of  which,  in- 
deed, existed  contemporaneously  with  feudalism,  though  not  with 
so  absorbing  an  influence  as  subsequently. 

"  This  original  engrossing  of  uncultivated  lands,"  says  Adam 
Smith,  "  though  a  great,  might  have  been  a  transitory,  evil.  They 
might  soon  have  been  divided  again,  and  broken  into  small  parcels, 
either  by  succession,  or  by  alienation.  The  law  of  primogeniture 
hindered  them  from  being  divided  by  succession  ;  and  the  intro- 
duction of  entails  prevented  their  being  broken  into  small  parcels 
by  alienation.  .  .  In  those  disorderly  times,  every  great  landlord 
was  a  sort  of  petty  prince.  His  tenants  were  his  subjects.  He 
was  their  legislator  and  judge  in  peace,  and  their  leader  in  war.  .  . 
The  right  of  primogeniture  still  continues  to  be  respected,  and  as 
of  all  other  institutions  it  is  the  fittest  to  support  the  pride  of  family 
distinctions,  it  is  still  likely  to  endure  for  many  centuries.  In  every 
other  respect,  nothing  can  be  more  contrary  to  the  real  interest  of 
a  numerous  family,  than  a  right  which,  in  order  to  enrich  one,  beg- 
gars all  the  rest  of  the  children.  Entails  are  the  natural  conse- 
quence of  the  law  of  primogeniture.  They  were  altogether  unknown 
to  the  Romans.  .  .  In  the  present  state  of  Europe,  when  small  as 
well  as  great  estates  derive  their  security  from  the  laws  of  their 
country,  nothing  can  be  more  completely  absurd.  They  are  founded 
upon  the  niost  absurd  of  all  suppositions,  viz.,  that  every  successive 
generation  of  men  have  not  an  equal  right  to  the  earth,  and  to  all 
that  it  possesses;  but  that  the  property  of  the  present  generation 
should  be  restrained  and  regulated  according  to  the  fancy  of  those 
who  died,  perhaps,  five  hundred  years  ago.      *      *       * 

"  In  the  ancient  state  of  Europe,  the  occupiers  of  the  land  were 
all  tenants  at  will.    They  were  all,  or  nearly  all,  slaves.     They  were 


168  THE    DIFFERENT    STATES    OF    SOCIETY. 

supposed  to  belong  more  directly  to  the  land,  than  to  their  master. 
They  could,  therefore,  be  sold  with  it,  but  not  separately.  They 
could  marry,  provided  it  was  with  the  consent  of  their  master.  If 
he  maimed  or  murdered  any  of  them,  he  was  liable  to  some  pen- 
alty, though  generally  but  to  a  small  one.  They  were  incapable  of 
acquiring  property.  Whatever  they  acquired,  was  acquired  to  their 
master,  and  he  could  take  it  from  them  at  pleasure.  They  could 
acquire  nothing  but  their  daily  maintenance.  This  species  of  slavery 
still  subsists  in  Russia,  Poland,  Hungary,  Bohemia,  Moravia,  and 
in  other  parts  of  Germany." 

It  is  easy  enough  to  see,  that  this  kind  of  slavery,  though  changed 
in  form,  and  in  many  particulars  mitigated,  still  subsists  in  western, 
southwestern,  and  southern  Europe,  as  well  as  in  the  parts  above 
mentioned  by  Adam  Smith.  The  spirit  and  practical  operation  of 
society  do  not  change  with  the  change  of  forms,  till  ages,  sometimes 
centuries,  have  rolled  away.  It  is  from  such  a  state  of  things  that 
European  society,  as  a  whole,  has  come  down,  and  it  still  exhibits 
almost  everywhere  like  elements,  often  the  same  in  substance. 

How  happens  it  that  in  Europe,  they  who  have  done  all  the 
work,  have  little  or  no  property,  external  to  their  own  persons,  not 
always  that ;  and  that  they  who  have  done  little  or  no  work,  have 
nearly  all  the  property  —  nearly  all  the  wealth  of  society?  The 
inference  is  natural,  that  there  is  something  wrong  in  this.  Pro- 
prietorship seems  to  have  passed  from  the  natural  proprietor  to  the 
unnatural  one,  and  the  order  of  nature  and  of  Providence  —  for 
how  can  they  disagree?  —  seems  to  be  reversed.  This  perversion, 
this  violence  that  has  crept  into  and  incorporated  itself  with  the 
social  fabric  of  the  old  world  —  which  has  been  one  of  the  great 
perversions  of  the  social  state  from  time  immemorial  —  is  being 
rectified  in  the  constitution  and  career  of  American  society,  and 
they  who  work  can  not  only  call  themselves  but  all  their  fair 
earnings,  their  own.  It  is  well  that  this  reform  should  be  gradual ; 
that  this  renovation  of  society  should  be  effected  by  a  new  con- 
struction on  a  more  just  basis  ;  that  this  violence  should  be  removed 
without  violence.  Restore  to  man  his  rights,  and  he  will  make 
his  own  way  to  the  rectification  of  the  errors  of  the  species.  But 
how  can  he  have  his  rights,  except  under  a  just  and  equitable  sys- 
tem of  public  economy  ? 


EDUCATION  IN  THE  UNITED  STATES.         169 


CHAPTER   XL 

EDUCATION    AS    AN    ELEMENT    OF    PUBLIC    ECONOMY    IN    THE 

UNITED    STATES. 

Edacation  a  Thing  of  Commercial  Value. — The  American  People  the  Original  Statesmen 
of  the  Country. — The  American  Republic  an  Experiment  for  the  World — Difference 
between  the  European  and  American  Theory  of  Society. — Knowledge  makes  the  Dis- 
tinction between  Freemen  and  Slaves  — Character  of  the  First  Settler.s  of  this  Country. — 
They  were  Men  of  high  Culture. — General  Education  made  the  Ba.sis  of  their  New 
State  of  Society. — Education  the  Power  that  achieved  American  Independence. — It  is 
the  mo.st  Important  of  all  the  Elements  of  an  American  System  of  Public  Economy. — 
A  System  of  Universal  Education  may  not  at  first  Produce  Examples  of  the  highest 
Culture. — The  American  System  gives  Equal  Chance.s  to  All. — System  of  American 
Schools  and  Colleges. — A  Protective  System  of  Public  Economy  indispensable  to  the 
American  System  of  Education. — Education  and  Virtue  Concomitants  in  a  Nation. — 
Comparative  Condition  of  European  a^d  American  Population,  Physical  and  Moral. — 
Edacation  makes  the  Difference. 

It  has  already  been  shown  that  the  rights  of  the  people  fall 
within  the  range  of  public  economy,  because  there  is  a  commercial 
value  in  them;  that  it  is  on  account  of  this  value  that  they  become 
important  and  worthy  of  being  asserted  and  maintained  ;  that  it  was 
commercial  value  alone  that  constituted  the  ground  of  controversy 
between  the  American  fathers  and  the  British  crown  ;  and  that,  but 
for  this  species  of  value,  wrested  from  the  colonists  and  ajipro- 
priated  by  the  crown,  there  would  never  have  been  any  controversy. 
It  has  also  been  shown,  that  these  rights  are  not  sordid  or  less 
worthy  of  respect  on  that  account ;  but,  on  the  contrary,  that  no 
rights  in  political  society,  which  are  of  any  consequence,  can  be 
shown  to  have  any  intrinsic  or  palpable  value  which  is  not  of  this 
kind.  Even  the  honorary  rights  of  monarchical  and  aristocratical 
forms  of  society,  such  as  tho.se  of  Great  Britain,  lose  all  their  im- 
portance, and  become  contemptible,  when  stripped  of  the  com- 
mercial values  which  sustain  them  in  their  position,  such  as  the 
estates  of  the  nobility. 

It  is  for  the  same  reason  that  education  becomes  one  of  the  most 
important  elements  of  public  economy  in  the  United  States  —  of  so 
great  importance  as  to  make  it  worthy  of  a  separate  and  special 
consideration. 

It  is  an  old  and  well-recognised  maxim,  running  back  to  the 
earliest  date  of  our  history,  that  a  republican  or  democratic  state 


170   EDUCATION  AS  AN  ELEMENT  OF  PUBLIC  ECONOMY 

of  society — we  use  these  terms  as  synonymous  and  interchangeable 
—  must  rest  on  the  intelligence  and  virtue  of  the  people.  The 
reasons  are  obvious.  The  peopje  being,  direcdy  or  indirecdy, 
immediately  or  mediately,  the  source  of  power,  the  originators  of 
the  government,  and  the  electors  of  rulers,  legislators,  judges,  and 
magistrates  —  of  all  branches  of  the  supervising  power — must  be 
qualified  by  their  intelligence  to  discern  the  fitness  of  those  in 
whose  hands  they  commit  these  important  trusts,  and  have  need 
also  of  a  corresponding  amount  of  virtue  to  discharge  these  duties 
with  fidelity  to  that  state  of  society  which  is,  by  such  means,  en- 
tirely in  their  hands.  In  a  democratic  community,  the  people  are 
the  original  and  fundamental  statesmen.  It  is  impossible  that  the 
government  should  be  better,  or  in  any  essential  degree  more  in- 
telligent than  they  are.  The  ancient  and  inspired  maxim,  "  like 
people,  like  priest,"  can  not  be  more  true  in  church  than  in  state. 
In  a  republic,  the  character  of  the  government  uniformly  exhibits  a 
reflex  image  of  the  character  of  its  electors,  and  vice  versa. 

It  is  admitted  on  all  hands,  and  all  the  world  over,  that  the  North 
American  republic  is  a  grand  experiment  to  determine  whether  a 
people  can  have  intelligence  and  virtue  enough  to  govern  them- 
selves, and  that  the  final  solution  of  this  problem  will  decide  the 
fate  of  the  world,  for  or  against  a  democratic  state  of  society,  for 
centuries  to  come,  if  not  for  ever. 

It  need  not  be  said,  that  the  intelligence  and  virtue  of  the  people 
depend  upon  education.  It  remains  to  show,  in  what  respects,  and 
how  far,  education  becomes  an  element  of  public  economy  in  the 
United  States.  We  are  not  prescribing  rules  for  European  or 
other  foreign  nations.  The  withholding  or  lack  of  popular  educa- 
tion among  them  —  for  it  is  the  education  of  the  people  generally 
of  which  we  speak  —  may  be  as  necessary  to  their  theory  of  society, 
as  the  enjoyment  of  it  is  to  ours.  It  has  already  and  frequently 
been  stated,  and  should  be  constantly  borne  in  mind,  that  Adam 
Smith  and  his  school  have  adapted  their  system  of  public  economy 
to  the  state  of  society  with  which  they  were  surrounded,  and  not 
to  that  which  exists  among  us.  It  is  impossible,  under  their  system, 
that  general  education  should  prevail  —  as  much  so  as  that  it  should 
prevail  among  slaves.  There  is  no  provision  for  it.  It  is  the  bare 
subsistence  only  of  those  who  do  the  labor  of  society  which  they 
have  provided  for.  In  the  first  place,  they  have  not  a  democratic 
state  of  society  ;  next,  they  do  not  propose  to  have  it;  thirdly,  they 
make  no  calculation  for  it;  and  lasdy,  as  the  working  classes,  under 


IN    THE    UNITED    STATES.  171 

their  system,  have  little  or  nothing  to  do  with  government,  their 
education  is  not  deemed  important.  On  the  contrary  it  is  system- 
atically suppressed,  because  it  is  reckoned  dangerous.  It  must  be 
seen,  therefore,  that  the  condition  of  society  in  the  United  States, 
in  these  particulars,  is  diametrically  opposite.* 

But  how  is  education  here  an  element  of  public  economy? 
How  does  it  appear,  that  it  has  a  commercial  value  in  it  ?  First, 
because  it  costs  something.  Next,  because  it  is  really  worth  some- 
thing. It  is  capital,  and  capital  of  the  most  productive^kind.  But 
thirdly,  and  above  all,  because,  in  the  United  States,  the  education 
of  the  people  is  the  only  secure  guardian  of  all  their  other  rights, 
which,  so  far  as  they  are  worth  maintaining,  are  so  only  because 
they  have  a  commercial  value  in  them,  as  before  shown. 

Knowledge  is  power.  There  is  little  difficulty  in  holding  the 
ignorant  and  debased  slave  fast  in  his  chains.  He  does  not  know 
how  to  gain  his  rights  —  how  to  devise  ways  and  means  ;  and  being 
depressed,  dejected,  demoralized,  he  has  not  the  courage  to  assert 
them.  The  fact  that  one  master,  as  is  often  the  case,  knows  how 
and  is  able  to  hold  ten,  or  twenty,  or  fifty,  or  a  hundred  slaves  in 
subjection,  and  to  keep  them  in  fear  of  himself,  so  that  they  dare 
not  disobey  him,  is  the  simplest  and  most  forcible  illustration  of  the 
power  of  knowledge,  in  the  application  now  under  consideration. 
The  difference  is  chiefly  in  knowledge ;  though  it  is  not  to  be  de- 
nied that  some  of  it  is  to  be  ascribed  to  the  moral  force  of  the 
machinery  of  society.  If  every  one  of  these  slaves  were  equal  to 
his  master  in  knowledge,  and  in  the  growth  and  vigor  of  the  social 
qualities,  it  is  not  to  be  supposed  they  could  long  be  held  in  bond- 
age, without  other  and  foreign  forces  not  required  in  their  present 
condition. 

The  original  setders  of  this  country  from  Europe  —  especially 
those  from  Great  Britain  —  were  men  of  intellig-ence  and  strong 
virtue.  Many  of  them  were  persons  of  as  high  culture,  and  of  as 
much  chivalry  of  character,  as  any  that  were  left  behind  them.  It 
may  be  said,  that  they  were  men  of  the  strongest  character  of  the 
times  that  produced  them;  and  those  who  followed  in  their  train, 
were  men  of  the  same  stamp.  The  motives  of  emigration  then 
were  of  a  high  and  social  character,  and  not  such  as  now  pour 

•  Notwithstanding  the  changes  which  are  taking  place  in  Europe,  since  the 
French  revolution  of  1848,  with  an  apparent  approximation  toward  a  democratic 
state  of  society,  our  argument  with  the  European  economists  generally,  of  the 
Free-Trade  school,  in  particular,  remains  in  full  force. 


172  EDUCATION  AS  AN  ELEMENT  OF  PUBLIC  ECONOMY 

upon  this  continent  the  floods  of  European  paupers  and  culprits. 
It  was  mind  of  the  highest  order,  which  could  not  endure  the 
chains  of  European  despotism,  and  which  came  here  for  freedom. 
The  object  of  their  coming,  and  the  qualifications  which  fitted  them 
for  the  enterprise,  are  directly  in  point  of  the  argument  in  which 
we  are  now  engaged.  It  was  their  high  culture  and  eminent  virtues 
which  enabled  them  to  lay  the  foundation  of  that  stupendous  sys- 
tem of  political  society  and  of  public  economy,  which  has  sub- 
sequently and  gradually  grown  up  on  their  endeavors  and  their 
plan.  Freedom  was  their  end,  and  the  means  which  they  ordained 
to  secure  it,  were  schools  and  religion,  education  and  the  virtues 
of  Christianity.  The  history  of  the  colonies,  from  the  earliest 
settlements,  down  to  the  revolution  and  establishment  of  American 
independence,  is  replete  with  proof  of  this  assertion.  There  arose, 
therefore,  from  the  first,  a  state  of  society  not  before  known  in  Eu- 
rope or  elsewhere  —  a  republican  or  democratic  society  in  which 
there  were  no  uneducated  classes,  and  no  laboring  classes  which 
did  not  comprehend  the  whole  community.  All  went  to  school, 
and  all  worked  when  old  enough  ;  and  on  no  point  were  the  people 
more  thoroughly  educated  than  on  the  principles  of  free  govern- 
ment. The  oppressions  of  the  old  world  drove  out  its  own  sons 
from  its  own  bosom,  and  under  its  own  charters,  to  set  up  a  school, 
which  must  necessarily,  in  a  course  of  time,  subvert  its  authority, 
and  become  independent,  because  the  emigrants  brought  away  all 
that  was  good,  and  left  behind  all  that  was  bad.  The  elements  of 
this  new  state  of  society  were  all  healthy,  and  full  of  infant  purity. 
While  the  old  world,  from  a  vitiated  and  decrepit  constitution, 
tended  to  decay,  the  new,  purged  of  parental  diseases,  sprang  up, 
with  giant  strides,  to  giant  vigor.  Instead  of  the  old  leaven  of  Eu- 
ropean economists,  that  intellectual  and  moral  culture  belongs  only 
to  the  higher  classes,  and  that  the  working  classes  require  nothing 
but  bare  subsistence  like  cattle,  schools  were  provided  for  all  —  all 
were  educated  —  trained  to  knowledge  and  virtue  as  a  preparation 
for  the  working  time  of  life.  It  was  a  republican  or  demociatic 
state  of  society  from  the  first,  and  continued  to  be  such,  till  the 
struggle  arose  between  the  colonies  and  the  mother-country,  which 
resulted  in  American  independence. 

It  is  to  this  point  of  American  history  that  attention  is  especially 
challenged  to  elucidate  our  argument.  And  in  answer  to  the 
question,  what  was  it  that  prompted,  sustained,  and  finally  achieved 
American  independence?  —  we  say,  it  was  the  diffusion  of  general 


IN    THE    UNITED    STATES.  173 

education  among  the  people,  and  nothing  else.  Suppose  the  people 
had  been  as  ignorant  and  debased  as  the  working  classes  of  Europe, 
what  could  they  have  done?  Besides  the  moral  impotency  of 
such  a  condition  of  society,  poverty  is  an  invariable  concomitant. 
The  people  generally  could  not  have  been  as  ignorant  without 
being  as  poor ;  and  along  with  this  poverty  of  the  mass  of  the 
people,  would  have  existed  rich  and  dominant  masters,  allied  by 
interest  to  the  British  crown,  in  the  same  manner  as  they  are  now 
in  Great  Britain  and  other  European  nations.  Nothing  could  have 
been  hoped  for,  and  nothing  achieved,  in  such  a  state  of  things,  by 
declaring  independence ;  but  the  result  would  have  been  an  easy 
and  speedy  victory  on  the  part  of  the  crown,  and  a  tighter  riveting 
of  the  chains  of  slavery.  Such  invariably,  in  all  history,  has  been 
the  end  of  all  such  struggles  between  such  parties. 

But  the  American  people  were  educated  ;  they  were  men  of 
full  stature,  intellectual  and  moral ;  they  were  for  the  most  part 
men  of  substantial,  though  of  moderate  independence ;  they  had 
imbibed  the  principles  of  freedom,  and  understood  them ;  and 
when  the  British  crown  asserted  its  oppressive,  tyrannical  claims, 
and  began  to  put  them  in  force,  it  was  soon  found  that  the  colonists 
were  not  of  that  mean  and  debased  class  who  know  not  how  to 
assert  and  maintain  their  rights.  It  was  their  intellectual  and  moral 
training  —  a  training  of  more  than  a  century  —  which  qualified 
them  to  rise  at  once  from  the  condition  of  dependent  colonies,  to 
that  of  an  independent  nation,  and  which  enabled  them  to  sustain 
a  contest  for  seven  long  years  against  the  most  powerful  nation  of 
the  world,  to  be  acknowledged  in  the  end  as  an  equal  and  a  rival. 

There  is  a  great  principle  arising  out  of  this  history,  which  ap- 
plies to  the  subject  now  under  consideration.  This  was  not  a 
chance  triumph  of  the  American  arms  —  of  the  weak  against  the 
strong;  but  it  was  the  result  of  the  operation  of  a  potent  element 
inherent  in  American  society,  viz.,  the  intellectual  and  moral 
culture  of  the  people.  The  physical  odds  against  them  was  im- 
mense ;  but  having  to  contend  against  this  moral  power,  it  was 
shivered  and  subdued.  Nor  does  it  detract  at  all  from  the  force 
of  this  reasoning  to  say,  that  the  warlike  barbarians  of  the  north 
of  Europe  once  overran  and  reduced  the  cultivated  and  refined 
nations  of  the  southf  for  the  latter,  as  admitted  by  all,  were  ready 
to  perish  through  their  own  debauchery  and  effeminacy.  Besides 
that  general  education  did  not  prevail  among  them,  the  seeds  of 
decay  had  been  sown  for  many  centuries,  and  the  final  dissolution 


174         EDUCATION  AS  AN  ELEMENT  OF  PUBLfC  ECONOMY 

only  awaited  an  adequate  shock.  The  descent  of  the  northern 
barbarians  was  one  of  those  retributions  of  Providence,  which 
sometimes  sweep  over  the  earth  Hke  a  tornado,  when  vice  and 
crime  have  nearly  dissolved  the  long  standing  fabrics  of  the  social 
state.  But  the  contest  of  the  American  colonies  with  the  British 
crown,  was  as  the  strife  of  young  and  vigorous  manhood  against 
decrepit  age,  prompted  and  sustained  rather  by  the  morale  of 
youthfulness,  than  by  the  skill  and  preparations  of  experience  ;  but 
the  efficacy  of  that  morale  consisted  in  the  great  elements  of  which 
we  are  now  speaking.  Slaves  rarely  rise  against  their  masters  with 
success ;  and  success  may  prove  their  greatest  misfortune.  The 
toiling  millions  of  Europe  may  toil  on  for  ages  and  for  centuries, 
as  they  have  done,  to  minister  to  the  power  of  European  govern- 
ments, to  the  splendor  of  its  nobiUty,  and  to  the  luxury  of  its 
superior  classes,  without  the  slightest  hope  of  emancipation  from 
their  debased  condition,  till  the  blessings  of  education  are  diffused 
among  them.*  It  was  intellectual  and  moral  culture  alone  that 
reared  this  republican  empire,  and  gave  it  a  permanent  rank  among 
the  nations  of  the  earth. 

These  views  eventually  lead  us  to  the  consideration  of  that 
state  of  public  or  national  economy,  in  that  particular  which  is  ne- 
cessary to  secure  and  sustain  in  perpetuity  a  sufficient  amount  of 
intellectual  and  moral  culture  among  the  people,  to  warrant  the 
continuance  of  a  free  government,  and  of  free  institutions.  How- 
ever important  the  numerous  ramifications  of  public  economy 
which  are  discussed  in  this  work,  may  seem  t©  be,  all  of  them  to- 
gether are  less  important,  dwindle  into  insignificance  compared 
with  this.  This,  indeed,  lies  at  the  foundation,  constitutes  the 
platform  of  the  whole  system.  Without  education,  without  morals, 
without  reli"-ion  —  and  education  is  the  instrument  of  morals  and 
reli"-ion  —  what  is  civilization?  Or,  rather,  without  these,  how 
can  there  be  civilization  ?  These  and  their  appurtenances  consti- 
tute civilization,  and  in  proportion  as  they  are  advanced,  civiliza- 
tion advances. 

It  is  not  denied  that  there  may  be  high  and  even  superlative 
degrees  of  intellectual  and  moral  culture,  specimens  of  the  purest 
morals,  and  examples  of  religion  worthy  of  imitation  and  of  all 

*  We  should  be  extremely  £;lad,  if  the  success  of  the  present  endeavors,  1848, 
to  establish  republican  institutions  in  Europe,  should  prove  that  we  have  made 
too  strong  a  statement  here;  but  even  that  would  not  detract  from  the  principle 
of  our  argument. 


IN    THE    UNITED    STATES.  17-5 

respect,  around  the  thrones  and  under  the  shades  of  the  most 
absolute  despotisms.  It  may  even  be  true,  that  these  examples  of 
the  highest  culture,  owe  their  excellence  to  the  patronage  of  princes, 
and  to  the  influence  of  a.concentrated  power,  the  means  of  which 
were  wrung  by  the  few  from  the  hard  and  servile  toil  of  the  mil- 
lions. It  may  also  be  true,  that  the  refinements  of  civilization,  in 
such  circumstances,  and  under  these  concentrated  influences,  shall 
be  in  excess  of  what  they  would  otherwise  have  been,  in  a  given 
time,  if  education  had  been  more  general  and  comprehensive, 
and  if  the  chances  of  high  culture  had  been  open  to  all.  Great 
bodies  can  not  move  with  so  much  rapidity  in  a  given  direction,  as 
small  ones,  when  the  same  amount  of  force  is  applied  to  each. 

But  it  need  not  be  said  that  this  is  not  the  intended  economy, 
the  plan  of  American  society.  It  was  not  devised  for  the  kw,  but 
for  the  many  ;  not  for  a  select  and  privileged  corps,  but  for  the 
millions.  General,  popular  education,  is  the  great  scheme  laid  out 
for  this  republican  empire.  If  there  be  any  feature  more  distinct, 
more  prominent,  and  more  observable,  in  the  social  structure  of  this 
great  commonwealth,  than  any  oiher,  it  is  that  of  equal  chances  in 
life  to  all  ;  that  a  child  shall  not  be  born  to  ignorance,  for  want  of 
opportunities  to  acquire  knowledge  ;  that  he  shall  not  be  doomed 
to  a  low  condition  because  such  was  the  lot  of  his  parents ;  and 
that  there  shall  be  no  insuperable  impediments  of  a  social  and 
moral  nature  to  his  advancement  in  the  social  state,  to  any  eleva- 
tion, not  excepting  the  highest  within  the  scope  of  a  just  and  laud- 
able ambition. 

The  system  of  common  schools,  early  set  up  in  this  country, 
coeval  indeed  with  American  civilization,  handed  down  from  gen- 
eration to  generation,  provided  for  as  the  first  care  of  the  state, 
watched  over  with  paternal  solicitude,  nurtured,  endowed,  edified, 
and  never  suffered  to  decline,  but  always  put  forward  with  vigor 
and  efiiciency,  is  the  cradle  of  those  chances  of  which  we  speak. 
On  this  broad  foundation,  common  to  all,  has  been  erected  a  sys- 
tem of  select  and  higher  schools,  up  to  the  college  and  university, 
which  are  also  within  the  reach  of  all,  by  reason  of  a  system  of 
public  economy,  which  it  is  our  special  purpose  in  this  chapter  to 
notice ;  not,  indeed,  so  much  whhin  the  reach  of  all,  as  the  com- 
mon schools,  but  yet  not  excluding  any,  nor  presenting  insuperable 
obstacles  to  any.  The  poorest  and  meanest  born  of  the  land, 
prompted  by  innate  ambition,  and  developing  hopeful  talent,  can, 
and  do  often,  pass  through  all  the  stages  of  education,  from  the 


176         EDUCATION  AS  AN  ELEMENT  OF  PUBLIC  ECONOMY 

common  school  till  they  have  graduated  with  honor  at  the  highest 
seminaries,  and  entered  upon  the  graver  responsibilities  of  life,  to 
contend,  in  open  and  fair  field,  with  the  best  born,  for  the  highest 
prizes  of  the  social  state,  whether  of  wealth  or  of  influence.  And 
it  is  an  attribute  of  American  society  and  institutiotiS,  to  favor  and 
help  forward  merit  that  emerges  from  obscurity  and  strives  to  rise. 
The  common  school  is  the  basis  of  all ;  the  genius  of  the  gov- 
ernment is  the  parent  of  all  ;  and  the  joint  operation  of  the  two 
crowns  all. 

We  come,  then,  to  the  main  point  which  now  claims  to  be  con- 
sidered, viz.,  that  a  protective  system,  as  expounded  and  illustrated 
in  other  parts  of  this  work,  in  its  indissoluble  connexion  with  the 
ability  of  the  people,  imparting  and  securing  that  ability,  to  avail 
themselves  of  all  these  advantages,  is  the  only  means  by  which 
this  great  end  of  American  society  can  be  realized. 

It  has  been  seen,  that,  as  a  general  truth,  the  American  people 
WORK  for  their  living;  that  they  depend  on  labor,  in  one  form  or 
another ;  and  that  their  fortune  is  vested  in  the  rewards  of  their 
own  personal  exertions.  The  difference  between  the  condition  of 
American  and  that  of  European  labor,  the  former  as  an  indejmid- 
ent  agent,  and  the  latter  as  an  agent  of  jiower,  is  elsewhere  pointed 
out.  It  will  be  seen,  that  the  only  provision  made  for  labor  by 
European  society,  and  by  the  Adam  Smith  school  of  economists, 
is  that  of  a  mere  physical  existence,  as  in  the  case  of  a  slave, 
which  dooms  the  laborers,  as  a  class,  to  live  and  die,  like  slaves,  in 
the  condition  in  which  they  are  born,  or  in  which  they  begin  to 
work.  Without  education  themselves,  they  are  unable  to  educate 
their  children,  except  for  their  tasks.  Whereas  the  condition  of 
American  labor  is  that  of  independence.  If  American  free  laborers 
are  uneducated,  it  is  not  because  they  have  had  no  opportunity 
to  improve  themselves ;  and  if  they  do  not  educate  their  children, 
it  is  not  because  they  are  unable.  Indeed,  in  the  common  school, 
which  most  of  the  states  provide,  especially  in  New  England,  it 
costs  them  nothing,  except  their  rate  of  assessment  as  to  property, 
which  throws  the  burden  on  the  rich,  and  exempts  the  poor  ;  or 
if  the  schools  are  endowed,  as  well  as  free,  as  in  some  places  they 
are,  they  are  a  tax  to  nobody  ;  or  partly  endowed,  as  in  Connecti- 
cut, Massachusetts,  New  York,  and  we  believe  some  other  states, 
the  tax  is  so  much  lighter  to  those  who  have  to  pay.  But  the  sys- 
tem is  designed  to  provide  education  for  all,  the  poorest  as  well 


IN    THE    UNITED    STATES.  177 

as  those  who  are  better  off  in  life.     It  is  a  part  of  the  economy  of 
American  society. 

The  proposition,  therefore,  which  we  here  assert  and  propose  to 
maintain,  is,  that  a  protective  system  is  the  great  power  that  sus- 
tains, and  the  only  cause  that  can  secure,  general  and  popular 
education  in  the  United  States;  and  consequently,  that  it  is  the 
only  power  that  is  capable  of  preserving  the  liberties  of  the  coun- 
try. The  second  part  of  this  proposition  has  been  before  consid- 
ered, under  its  commercial  aspects.  Its  moral  features  also  claim 
attention,  although  both  views  of  the  subject  are  so  intimately 
blended,  that  it  is  not  easy  to  separate  them  even  in  discussion  ; 
much  less  in  their  practical  operation. 

A  cursory  glance  at  the  physical,  moral,  and  social  condition  of 
the  laboring  classes  of  Europe,  will  cast  the  light  of  a  strong  con- 
trast on  the  condition  of  American  free  laborers,  in  the  same  as- 
pects;  and  it  need  not  be  said,  that  these  classes  here,  include 
nearly  all  —  are  the  people.  First,  the  laboring  classes  of  Europe 
are  abject  in  their  social  position.  Few  of  them  have  any  political 
rights,  even  nominal ;  none,  to  speak  of,  more  than  this,  which  is 
of  no  account  in  its  beneficial  results  to  themselves.  And  they  feel 
their  abject  condition  ;  and  along  with  this  feeling,  as  a  fruit,  comes 
an  abject,  hopeless  state  of  their  minds.  This  oppressive  sense  of 
social  degradation,  is  that  which  unmans  man  —  divests  him  of 
pride,  of  ambition,  of  aspiring  views,  of  self-respect,  of  all  great 
and  noble  purposes,  and  makes  him  a  slave  —  a  mere  tool  of  those 
for  whom  he  lives  and  toils.  Along  with  this  social  degradation, 
comes  moral  debasement  —  abandonment  to  vice  and  crime.  Where 
there  is  no  reward  of  virtue,  man  will  not  be  virtuous ;  and  with 
the  blight  of  his  prospects,  his  passions  are  corrupted.  Hence  the 
low  tone  of  moral  feeling,  and  the  increase  of  crime,  among  the 
degraded  classes  of  Europe.  Uninstructed,  and  unambitious  of 
moral  and  social  elevation,  man  is  as  much  more  brutal  than  the 
brutes,  as  his  faculties  are  more  inventive  ;  and  out  of  his  prolific 
nature,  thus  perverted  and  abused,  grow  savage  propensities,  and 
diabolical  deeds.  The  apology  for  forcing  and  keeping  him  down, 
springs  from  the  wrong  of  having  deprived  him  of  the  means  of 
education,  and  of  incentives  to  better  conduct.  How  could  he  do 
better,  in  the  physical  condition  of  a  slave,  and  forced,  for  want  of 
time  and  means  of  improvement,  to  grow  up  and  live  in  ignorance? 
Two  thirds  of  the  fair  reward  of  his  labor,  being  that  which  was 

12 


178  EDUCATION  AS  AN  ELEMENT  OF  PUBLIC  ECONOMY 

necessary  to  make  a  man  of  him,  to  raise  and  put  him  forward  in 
moral  and  social  existence,  has  been,  as  shown  in  this  work,  usurped 
and  absorbed  by  his  oppressors,  to  create  that  great  chasm,  that 
impassable  gulf,  that  lies  between  him  and  them. 

Turn  now  to  the  condition  of  the  American  people,  who,  as  the 
people,  are  also  the  laborers  of  the  country.  In  the  first  place, 
their  physical  condition  is  one  of  comfort,  of  independence,  and  of 
thrift,  because  they  work  for  themselves,  and  have  the  reward  of 
their  own  labor.  In  the  nex,t  place,  being  in  such  a  condition,  they 
have  time  to  think  ;  and  their  fathers  having  been  in  a  like  condi- 
tion, they  were  sent  to  school,  and  qualified  to  think.  Seeing  the 
worth  of  knowledge,  and  enjoying  its  satisfactions,  they,  in  turn, 
send  their  children  to  school,  because  they  love  them.  All  —  one 
generation  after  another  —  are  educated.  They  are  brought  up  in 
comfort,  taste  and  realize  the  blessings  of  intellectual  and  moral 
culture  which  they  have  enjoyed,  and  are  not  only  constantly  im- 
proving in  knowledge  by  books,  that  captivating  employment  of 
leisure  and  independence,  and  by  the  periodical  emanations  of 
the  press,  but  they  are  able  to  educate  and  prepare  their  children 
for  any  position  in  life  which  they  choose  to  assign  to  them,  as  none 
are  barred  to  any  class.  By  industry  and  economy,  they  can  not 
only  live  in  this  way,  and  in  this  way  bring  up  their  families,  but 
they  can  acquire  wealth,  enlarge  their  estates,  and  extend  their  in- 
fluence by  a  career  of  exemplary  morals  and  conduct.  Every 
stage  of  life  is  one  of  increasing  interest  to  them,  presenting  more 
powerful  incentives  to  virtue,  to  moral  and  social  eminence,  and  to 
leave  behind  them  an  independence  for  their  children,  and  a  good 
name  for  themselves.  All  along,  in  the  progress  of  their  lives,  they 
find  themselves  free  and  independent  members  of  a  political  com- 
monwealth, in  the  government  of  which  they  share,  and  which  se- 
cures to  them  all  these  blessings.  Withal  —  not  the  least,  but  the 
greatest — they  are  not  only  educated  for  time,  but  for  eternity. 

What  is  it,  that  has  given  to  the  American  people  a  position,  and 
secured  to  them  a  condition  and  destiny,  so  widely  different  from 
the  same  things  with  the  toiling  millions  of  the  European  world? 
The  answer  to  this  great  question,  is  simply  this  :  The  former  en- 
joy the  reward  of  their  labor,  while  the  latter  are  robbed  of  it.  The 
whole  truth  of  this  subject  is  embraced  in  this  single  and  brief  sen- 
tence. It  is  impossible  to  find  anything  appertaining  to  the  ques- 
tion, which  is  not  comprehended  in  this  answer. 

It  is  seen,  and  abundantly  proved,  in  the  progress  of  this  work, 


IN    THE    UNITED    STATES.  179 

that  a  protective  system  is  the  only  shield  of  this  position  and  con- 
dition of  the  American  people  ;  and  that  the  direct  and  inevitable 
tendency  of  Free  Trade,  is  to  put  American  and  European  labor 
to  work  on  the  same  platform,  in  the  same  field,  for  the  same  mar- 
ket, on  the  same  terms,  with  a  like  result  in  the  physical,  intel- 
lectual, moral,  and  social  condition  of  both.  This  result  is  inev- 
itable, because  it  comes  from  the  operation  of  a  great  commercial 
principle,  which  governs  the  whole  commercial  world ;  and  about 
which  there  can  be  no  uncertainly,  beaause  it  is  a  result  told  by 
figures,  in  connexion  with  the  moral  certainty,  that  buyers  will  al- 
ways trade  as  cheap  as  they  can,  and  sellers  as  dear  as  they  can. 
Universal  Free  Trade  makes  one  market  of  the  wide  world,  and 
no  laborers  for  that  market  can  have  better  chances  than  others ; 
but  all  will  be  on  the  same  level. 

But  it  would  be  impossible,  by  such  a  concession,  to  elevate  the 
condition  of  the  laboring  classes  of  Europe.  Their  oppressors 
would  still  have  the  same  hold  upon  thera  ;  and  with  that  grasp,  on 
a  basis  of  Free  Trade,  they  would  draw  into  their  power,  and  un- 
der their  hand,  the  whole  American  people,  to  the  loss  of  all  the 
treasure,  agony,  and  blood,  that  have  been  spent  for  a  rescue. 


180    PROTECTlOjr    NOT    RESTRICTION,    BUT    EMANCIPATION. 


CHAPTER    XII. 

PROTECTION    NOT    RESTRICTION,    BUT    EMANCIPATION. 

What  is  meant  by  a  Restrictive  System? — It  is  a  Misnomer  as  applied  to  Protection. — 
Free  Traders  and  Protectionists  in  tlie  United  States  are  both  after  the  same  thing. — 
The  true  Relation  between  Capital  and  Labor. — The  most  perfect  State  of  Society — 
Capital  is  Labor  in  Repose. — Protection  of  Capital  is  the  Protection  of  Labor. — An 
American  Protective  System  a  Rescue  from  a  Foreign  Restrictive  System. — American 
Labor  can  not  be  free,  without  Piotection. — The  Protection  of  one  American  Interest 
can  never  injure  another  American  Interest,  but  benefits  all. — Examples  and  Pi  oofs. — 
The  Piisitioii  of  American  Capital  and  Labor  in  Rela  ion  to  Foreign  Capital  and  Labor. 
Consideration  of  the  Maxim  that  a  Nation  must  buy  in  Order  to  sell. — The  Prosperous 
and  Rich  buy  and  trade  mo.*t — Protection  makes  us  rich  ;  the  want  of  it  makes  us  poor. 

A  Rule  for  one   Nation  may  be  bad  for  another — Why  does  Great  Britain  preach 

Free  Trade  ? — Adam  Smith  began  right,  and  ended  wrong, — He  leaped  to  his  Conclu- 
sion from  False  Premides. 

Much  of  the  force  of  the  argument  of  Free-Trade  economists, 
rests  on  the  assumption  of  what  they  call  a  restrictive  system,  to 
which  they  are  opposed.  Now,  if  we  are  able  to  show  that  an 
American  protective  system,  so  far  from  being  restrictive  on 
American  industry,  American  labor,  and  American  interests,  oper- 
ates, on  the  contrary,  to  set  them  free  ;  to  leave  them  untram- 
melled ;  to  give  them  full  scope  for  action  and  profit ;  to  rescue 
them  from  disadvantages  and  hinderances  placed  in  the  way  of  their 
objects  ;  to  secure  their  natural,  social,  and  political  rights  ;  to 
exemj)t  them  from  restriction,  the  very  thing  complained  of  as  the 
effect  of  a  protective  system  —  in  other  words,  to  accomplish  the 
very  end  of  Free  Trade,  as  averred  by  its  advocates,  and  as  un- 
derstood by  nearly  or  quite  all  those  Americans  who  are  in  favor 
of  it ;  then,  clearly,  it  will  result,  that  Protectionists  and  Free- 
Traders  in  the  United  States,  are  both  after  the  same  thing,  and 
differ  only  in  the  way  of  obtaining  it.  It  is  the  object  of  this  chap- 
ter to  show  that  such  is  really  the  fact. 

We  have  proved  abundantly,  in  other  parts  of  this  work,  that 
the  chief  disadvantage  under  which  American  industrial  efforts 
labor,  is  the  greater  cost  of  money  and  labor,  in  other  words  of 
labor  itself,  in  this  quarter,  as  compared  with  its  price  in  foreign 
parts.  It  is  the  difference  between  the  freedom  and  the  bondage 
price  of  labor.  This  difference  affects  capital  as  well  as  labor,  in 
the  same  manner  and  degree  ;  for  we  have  elsewhere  shown  that  all 
capital  is  the  product  of  labor,  the  cost  of  which  must  necessarily 


PROTECTION    NOT    RESTRICTION,    BUT    EMANCIPATION.    181 

be  graduated  by  the  price  of  labor.  By  the  rights  or  institution 
of  property,  as  secured  by  every  civilized  society,  capital  or  prop- 
erty when  acquired  by  industry  and  prudence,  comes  to  occupy 
the  position  of  the  employer  of  labor,  in  order  that  labor,  in  its 
turn,  enjoying  a  freedom  price  under  adequate  protection,  may  rise 
to  the  same  condition,  by  the  same  means.  This  is  the  American 
wheel  of  fortune,  where  the  rights  of  primogeniture  and  of  entail 
have  been  abolished  by  fundamental  law.  Human  sagacity,  after 
having  removed  all  exclusive  prerogatives  of  birih,  and  all  rifht 
in  the  owners  of  properly  to  entail  its  descent,  has  not  been  able 
to  invent  a  better  or  more  equal  state  of  society  than  for  men  on 
such  a  basis,  to  rise  in  the  world  by  their  own  industry  and  econ- 
omy. In  this  way,  labor  capital,  which  is  the  parent  of  all  other 
capital,  holds  its  chances  in  reversion,  to  become  the  possessor  and 
controller  of  other  capital,  and  itself,  in  turn,  the  employer  of  labor. 
These  are  the  rights  of  labor.  It  would  be  hard,  indeed,  that  the 
power  to  labor,  which,  when  applied,  is  the  producer  of  all  the 
means  of  enjoyment  in  civilized  society,  should  never  itself  be  able 
to  come  to  such  enjoyment.  The  very  design  of  American  society, 
is  to  keep  open  these  chances,  which  European  society  for  ever 
bars,  as  a  general  rule.  Exceptions  to  a  rule  only  demonstrate  its 
existence  and  sway. 

Now  it  is  evident,  since  capital,  the  product  of  labor,  when 
acquired  as  above  described,  in  any  considerable  amount,  occupies 
the  position  of  the  employer  of  labor  ;  and  since  capital,  so  acquired, 
is  nothing  more  or  less  than  labor  in  another  form  or  state,  that  is, 
in  a  condition  of  productive  repose  ;  and  since  this  capital  must 
have  cost  in  proportion  to  the  price  of  the  labor  that  produced  it; — 
it  is  evident,  we  say,  first,  that  this  capital  can  not  be  employed  in 
the  same  ways  with  foreign  capital,  which  has  costs  only  half  as 
much,  without  protection  ;  and,  secondly,  it  is  evident  that  the  pro- 
tection of  this  capital  is  the  protection  of  labor  itself,  not  only  be- 
cause it  is  labor  in  another  form,  as  being  its  product,  but  because 
it  can  not  employ  labor,  in  these  ways,  without  protection.  When- 
•ever,  therefore,  American  capital  asks  for  protection,  in  this,  that, 
or  the  other  pursuit,  no  matter  what,  it  is  labor,  and  nothing  else, 
that  asks  for  it.  And  what  for?  To  rescue  it  from  the  restriction, 
or  the  restrictive  system,  under  which  it  lies  and  labors,  by  the  ex- 
istence and  operation  of  cheap  foreign  capital  and  cheap  foreign 
labor  ;  in  other  words,  to  give  and  secure  freedom  to  American 
labor.     It  can  not  be  free  unless  it  is  protected  ;  but  the  tendency 


162    PROTECTION    NOT  RESTRICTION,    BUT    EMANCIPATION. 

and  effect  of  this  foreign  system,  operating  on  American  labor 
restrict'tvely,  is  to  keep  it  under  and  keep  it  down.  It  can  not 
rise,  it  can  not  enjoy  its  rights,  because  it  is  under  the  operation 
of  a  foreign  restrictive  system  ;  that  is,  restrictive  relative  to  itself. 
It  will  be  seen,  therefore,  that  the  professed  objects  of  the  advo- 
cates of  Free  Trade  and  of  Protection,  in  the  United  States,  are 
identical.  Both  aim  at  a  rescue  from  a  restrictive  system.  It 
must  also  be  seen  that  Protection  is  the  only  way  to  gain  that  end. 

But  it  is  said  that  a  protection  of  one  or  more  interests,  is  a  re- 
striction on,  and  a  disadvantage  to,  one  or  more  other  interests. 
We  have  proved,  in  other  chapters,  that  an  American  protective 
system  can  not  injure,  but  must  necessarily  benefit,  all  interests  of 
4ie  country  ;  that  protective  duties  are  not  taxes  (which  is  the  only 
cbjection  that  ever  was  or  can  be  made  against  them)  ;  and  that 
they  are  a  rescue  from  an  enormous  system  of  foreign  taxation. 
We  need  not,  therefore,  undertake  to  prove  here  what  is  proved 
elsewhere  ;  but  we  are  entitled  to  assume  it,  so  far  as  the  present 
argument  may  require.  We  grant  there  may  be  inequalities  in  a 
protective  S}  stem,  so  far  as  that  one  interest  may  have  a  better 
protection  than  another.  This  may  be  owing,  either  to  the  fault 
of  those  who  suffer  this  inequality,  or  to  that  of  the  legislators  in 
not  properly  adjusting  the  system.  But,  though  this  may  be  a  just 
ground  of  complaint  as  a  partiality,  it  is  not  a  positive  injustice. 
The  principle  on  which  a  protective  system  is  required  in  the 
United  States  is  such,  that  it  can  not  but  be  beneficial  to  all,  though 
it  be  partial  in  its  application.  Though  it  begin  with  a  single  in- 
terest, and  afford  protection  to  no  other,  all  that  that  interest  gains 
by  it,  is  so  much  gain  to  the  country,  and  an  injury  to  no  party, 
even  though  the  protective  duties  be  prohibitory.  We  have  else- 
where cited  the  highest  Free-Trade  authorities  to  establish  this 
point,  though  it  were  superfluous.  But  when  Ricardo  and  Say 
admit  that  prohibitory  duties  can  not  in  the  end  raise  prices,  as 
domestic  competition  will  soon  bring  them  to  their  natural  level. 
Free  Trade  answers  itself  But  we  have  shown  that  Protection 
not  only  does  not  raise  prices  of  manufactured  articles,  but  that  it 
actually  reduces  them,  as  a  general  rule,  very  essentially.  It  mat- 
ters not,  therefore,  so  far  as  the  interest  of  the  country,  or  of  any 
parties  in  it,  is  concerned,  whether  Protection  be  partial  or  general. 
All  are  benefited,  and  none  are  positively  injured. 

Suppose,  then,  that  some  one  interest,  such  as  the  fabrication 
of  cotton   goods,  in  their  various  forms,  has   received  such   an 


PROTECTION  NOT  RESTRICTION,  BUT  EMANCIPATION.       183 

amount  of  protection  from  the  government  of  the  United  States, 
that  they  could  be  manufactured  in  this  country,  against  the  supe- 
•  rior  skill  and  cheaper  labor- of  Great  Britain.  Time  was,  when 
such  protection  was  absolutely  necessary  to  begin.  Behold  the 
result.  American  capital,  itself  the  product  of  American  labor, 
has,  to  a  vast  amount,  been  invested  in  cotton  manufactures,  under 
a  system  of  Protection,  to  employ  a  vast  amount  of  American 
labor,  and  to  consume  a  vast  amount  of  American  agricultural  and 
other  products.  And  consider,  that  this  could  never  have  been 
done,  without  protection,  which  is  undoubtedly  true.  But  for  this 
protection,  all  this  American  capital  and  labor  would  have  been 
shut  up  under  a  foreign  restrictive  system;  and  it  was  only  by 
such  protection,  that  they  have  been  emancipated  from  these  re- 
strictions, and  been  productive  of  such  immense  saving,  and  such 
immense  wealth  to  the  country,  and  of  such  great  benefit  to  all  the 
parties  concerned.  We  have  shown  elsewhere,  how  greatly  cotton 
goods  of  every  description  have  been  cheapened  by  this  system. 
Protection,  therefore,  so  far  as  this  great  interest  is  concerned,  and 
so  far  as  all  other  interests  of  the  country  with  which  it  is  connected, 
and  to  which  its  success  and  prosperity  have  brought  like  results, 
are  concerned,  has  been  the  means  of  emancipation  to  both  it  and 
them,  on  an  immense  scale.  Emancipation  from  what?  From  a 
foreign  restrictive  system  ;  from  that  system  of  foreign  society,  and 
of  the  bondage  of  foreign  labor,  against  which  it  would  have  been 
impossible  to  contend,  without  Protection.  We  see,  therefore,  that 
such  is  the  position  of  American  capital  and  American  labor,  in 
these  particulars,  in  relation  to  foreign  capital  and  labor,  that  they 
could  not  be  free  without  Protection.  That  this  protective  system 
has  operated  as  a  restriction  on  foreign  injustice,  which  before  held 
American  capital  and  labor  in  bondage,  is  not  denied.  So  far  an 
American  protective  system  is  restrictive  ;  and  so  far  as  this  is 
what  the  Free-Trade  economists  complain  of,  their  complaint  is 
well  founded.  But  to  say,  that  an  American  protective  system  is 
restrictive  upon  and  in  relation  to  American  interests,  when  the 
very  design,  and  not  less,  as  above  seen,  the  operation,  of  that 
system,  is  to  set  American  interests  free,  and  give  them  a  chance 
to  live  and  prosper,  against  the  oppressive  power  of  foreign  interests, 
is  absurd.  Thus  an  emancipafmg,  is,  by  a  misnomer,  called  a 
restrictive  system;  and  this  is  one  of  the  great  objections  alleged 
against  it. 

What  we  have  said  above  of  the  cotton  manufacturing  interest, 


184       PROTECTION  NOT  RESTRICTION,  BUT  EMANCIPATION. 

is  equally  applicable  to  every  other  American  interest,  no  matter 
what,  so  far  as  Protection  has  been,  or  may  yet  be,  necessary,  to 
give  it  a  start,  and  to  sustain  it,  against  the  rival  and  oppressing 
power  of  foreign  capital  and  labor,  engaged  in  the  same  pursuits. 
Protection,  in  such  cases,  does  not  operate  as  a  restriction  on  home 
interests,  nor  as  a  disadvantage  to  any  ;  but  it  is  a  benefit  to  all ; 
it  encourages  all ;  draws  thetn  out,  and  gives  them  a  wider  and 
more  comprehensive  scope  of  operation  and  of  profit.  Not  a 
single  new  American  interest  can  be  set  up  by  Protection,  that  is 
not  beneficial  to  some,  often  to  many  other  interests  ;  and  not  one 
that  is  injurious  to  any  other.  The  amount  of  emancipation  of 
capital  and  labor,  bears  more  directly  on  the  interest  protected  ; 
but  it  is  not  confined  to  that.  In  helping  that,  it  helps  others  ;  and 
the  entire  effect,  in  all  its  scope,  instead  of  being  restrictive,  is 
liberative,  in  relation  to  home  interests,  and  especially  to  the  capital 
and  labor  which  are  vested  in  them. 

Such  is  the  position  of  American  capital  and  labor,  in  relation  to 
forei'i-n  capital  and  labor,  that  it  is  impossible  to  protect  the  former, 
in  any  particular,  or  for  any  object,  or  in  any  degree,  short  of 
positive  bounty,  so  as  to  be  injurious  to  any  other  branches  of  the 
same,  or  so  as  not  to  be  in  some  degree  beneficial  to  all,  directly 
or  indirectly,  by  proximate  or  by  remote  influences.  There  is  no 
fear,  therefore,  of  extending  Protection  to  too  many  objects.  As 
to  the  amount,  in  any  given  case,  and  in  every  case,  as  it  may 
happen  to  require  it,  a  regard  may  safely  be  had  to  the  objects  of 
revenue,  as  well  as  to  those  of  Protection,  so  long  as  it  is  thought 
best  to  depend  on  this  mode  of  raising  revenue.  The  rule  of 
graduating  Protection  is  considered  in  a  subsequent  chapter.  So 
that  it  BE  Protection,  it  is  enough. 

It  is  said,  that  a  nation  must  buy,  in  order  to  sell,  and  that  this 
multiplication  of  home  interests  by  Protection,  will  restrict  and 
diminish  foreign  commerce  ;  which  seems  plausible  at  first  sight, 
in  the  same  manner  as  it  is  commonly  or  extensively  thought,  that 
the  protection  of  one  or  more  of  the  domestic  interests  of  the 
country,  will  operate  as  a  restriction  on  others.  But  we  have 
proved,  in  another  chapter,  by  a  statistical  array  of  well  authen- 
ticated facts  and  tables,  running  back  through  our  commercial 
history,  that,  whenever  and  in  proportion  as  our  public  policy  has 
approximated  toward  Free  Trade,  our  carrying  trade  and  foreign 
commerce  have  declined  ;  and  that,  whenever  and  in  proportion 
as  we  have  gone  back  to  a  protective  system,  our  carrying  trade 


PROTECTION  NOT  RESTRICTION,  BUT  EMANCIPATION.       185 

ioid  foreign  commerce  have  been  augmented.  And  these  different 
retuhs  are  clearly  proved  to  have  been  the  legitimate  effects  of 
these  different  measures.  The  answer,  therefore,  is  complete,  not 
only  as  regards  domestic  interests,  which  seem  more  especially  to 
occupy  a  domestic  position  ;  but  also  as  regards  the  interests  of 
foreign  commerce.  While  considering  this  last  point,  in  its  place, 
we  have  found,  that,  as  a  private  individual,  who,  by  his  industry 
and  frugality  prospers  and  grows  rich,  usually  trades  more,  and 
buys  more,  so  a  nation,  by  like  habits,  and  in  a  like  career,  trades 
more  and  buys  more,  because  it  has  the  means,  and  can  afford  it. 
Wants  always  multiply  with  growing  wealth  ;  and  those  wants 
must  be  satisfied.  We  have  elsewhere  shown,  that  the  United 
States  uniformly  grow  rich  under  a  protective  system,  and  poor  for 
the  want  of  it ;  and  this,  on  the  principle  above  recognised, 
accounts  for  our  having  a  greater  amount  of  foreign  commerce 
under  the  former,  than  under  the  latter  system  of  public  policy. 

In  no  sense  whatever,  therefore,  and  in  regard  to  no  interests 
whatever,  does  a  protective  operate  as  a  restrictive  system,  in  the 
United  States;  but,  on  the  contrary,  it  contributes  effectively,  and 
on  an  immense  scale,  to  the  emancipation  of  American  capital  and 
labor  from  a  foreign  restrictive  system,  which  has  so  long  held,  and 
which  will  for  ever  hold,  them  in  bondage,  without  Protection. 
It  neither  binds,  nor  restricts,  nor  injures  any  domestic  interests; 
but  is  a  help  to  all.  It  is  entirely  a  misnomer,  a  perversion  of 
terms,  to  call  it  a  restrictive  system,  as  applied  to  the  United  States. 
We  do  not  pretend  to  give  law  to  other  nations,  nor  to  say,  that  it 
does  not  operate  so  in  other  quarters ;  nor  can  we  consent  that 
foreign  economists,  British  or  others,  should  give  laws  to  us,  in  this 
particular.  We  have  set  out,  in  this  work,  on  the  fundamental 
principle,  that  a  system  of  public  economy  can  not  be  found, 
equally  applicable,  even  to  any  two  nations  ;  much  less  to  all;  and 
that  it  is  not  a  science,  composed  of  the  same  propositions,  every- 
where and  in  all  time,  as  the  Free-Trade  economists  claim  for  it. 
We  find  American  capital  and  labor  occupying  a  very  different 
position  from  that  of  the  same  things  in  Europe,  and  that  the  same 
treatment  applied  to  both,  would  not  be  beneficial  to  both.  A 
system  which  is  good  for  Great  Britain,  may  be  ruinous  to  the 
United  States.  We  have  endeavored  to  show,  in  another  chapter, 
that  Great  Britain  is  the  only  nation,  that  is  prepared  for  Free 
Trade,  and  the  United  States  the  last  that  can  afford  it ;  and  the 
reason  why  we  can   not  afford  it,  is  because  of  the  high  price  of 


186       PROTKCTION  NOT    RESTRICTIOX,  BUT  EMANCIPATION. 

our  labor.  On  a  platform  of  universal  Free  Trade,  the  advanced 
position  of  Great  Britain  —  far  advanced  of  all  other  nations — in 
her  skill,  machinery,  capital,  and  means  of  commerce,  would  make 
all  the  world  tributary  to  her ;  and  on  the  same  platform,  this  dis- 
tance between  her  and  other  nations,  in  these  particulars,  instead 
of  diminishing,  would  be  for  ever  increasing,  till,  as  she  is  now  the 
o-reat  centre  of  civilization,  she  would  become  the  focus  of  the 
wealth,  grandeur,  and  power  of  the  world.  Such  a  result  would 
be  inevitable,  on  these  conditions,  from  the  comparative  strength 
of  her  position  in  these  particulars.  Nothing  but  a  system  of  Pro- 
tection can  defend  us,  or  any  other  nation,  from  her  grasping  am- 
bition and  power.  Well  may  she  plead  the  cause  of  Free  Trade. 
Foreseeing  this  state  of  things,  she  has  endowed  her  writers,  and 
instructed  the  professors  of  her  universities,  for  a  century  past,  as 
shown  in  another  chapter,  to  preach  Free  Trade  to  the  world,  that 
she  might  reap  the  benefit. 

It  will  be  found,  on  an  examination  of  Adam  Smith's  reasoning 
on  "freedom  of  commerce,"  or  Free  Trade,  that  the  premises  on 
which  he  started  in  this  argument,  and  which  prompted  it,  were 
entirely  of  a  different  class  from  those  on  which  the  theory  of  Free 
Trade  now  usually  rests,  and  on  which  has  finally  been  erected  the 
system  which  is  now  adopted  by  those  of  his  school.  Adam  Smith 
was  right  in  the  ground  be  originally  took  ;  but,  like  all  bold  theo- 
rists, he  jumped  to  general  conclusions  from  isolated  facts.  Hav- 
in"-  first  begun  to  sail  his  bark  in  a  mill-pond,  England,  he  leaped 
the  dam,  followed  the  stream  to  the  ocean,  and  was  soon  lost  in 
the  wide  sea.  It  was  against  the  unjust  monopolies  of  certain  mu- 
nicipal corporations,  known  as  "  the  trades"  in  English  law,  but 
entirely  unknown  in  the  United  States,  that  Adam  Smith  began  to 
plead  for  Free  Trade.  These  corporations  were  almost  without 
number  in  Great  Britain,  counting  at  one  time  more  than  a  hundred 
in  the  city  of  London,  such  as  the  company  of  goldsmiths,  saddlers, 
fishmono-ers,  &c.,  &c.,  comprehending  all  the  principal  trades,  in 
town  and  country.  None  could  engage  in  these  pursuits,  who  were 
not  members  of  the  companies  ;  and  each  of  these  corporations 
took  care  not  to  fill  the  trade,  so  that  the  market  should  be  beyond 
their  control.  The  community  were  forced  to  buy  of  them,  at  their 
own  price.  Hence  the  grievance  of  these  monopolies,  and  the 
crusade  of  Adam  Smith  against  them.  He  also  extended  his  ar- 
gument against  the  monopolies  of  foreign  commerce,  in  the  hands 
of  companies,  such  as  the  East  India  company,  the  Hudson  Bay 


PKOTECTION  NOT  RESTRICTION,  BUT  EMANCIPATION.       187 

company,  the  African  conipany,  &c.     In  both  these  lines  of  argu- 
ment, his  premises  justified  his  conclusion,  and  he  was  right. 

But  neither  he,  apparently,  nor  any  of  his  school,  have  allowed 
themselves  to  see  the  difference  between  these  cases  and  those 
made  by  a  general  protective  system  of  one  nation  against  others, 
in  the  latter  of  which  there  is  no  monopoly  of  one  citizen  or  sub- 
ject against  others,  but  where  all  are  permitted,  under  a  common 
law  made  for  all,  to  engage  In  what  trade  or  business  they  please, 
and  where  competition  can  enter  without  limits.  To  say,  that  Pro- 
tection Is  sometimes  prohibitory  of  foreign  products,  does  not  make 
out  the  case  of  a  monopoly,  except  such,  the  undoubted  right  of 
which  all  nations  claim,  and  are  constantly  In  the  habit  of  exer- 
cising ;  and  then  the  monopoly  is  national,  not  private.  This  was 
not  the  ground  of  objection  with  Adam  Smith.  He  never  once 
made  it,  nor  will  it  be  made  by  any  advocate  of  Free  Trade,  un- 
derstandingly.  But  the  objection  was  and  Is,  that  protection  of 
domestic  industry,  arts,  and  labor,  against  foreign  arts  and  labor, 
imposed  and  imposes  restrictions  on  fellow-subjects  and  fellow-citi- 
zens, when  in  fact,  as  every  one  must  see,  there  was  and  is  no  such 
thing,  and  can  not  be,  so  long  as  there  are  no  corporate  privileges 
to  exclude  others  from  engaging  In  the  same  pursuits  at  pleasure. 
There  can  not  be  a  monopoly,  where  the  trade,  or  pursuit.  Is  equally 
open  to  all.  If  a  man  is  excluded  for  want  of  capital  or  skill,  or 
for  want  of  both,  this  may  occur  under  any  system,  and  is  the  very 
reason  why  one  nation  may  require  protection  against  another  of 
more  abundant  capital  and  of  superior  skill,  and  why  it  can  not 
engage  In  certain  pursuits,  essential  to  Its  welfare,  without  protec- 
tion. But  both  Ricardo  and  Say  have  admitted  and  maintained, 
that  even  prohibitory  duties  can  not  raise  prices,  because,  where 
there  is  no  domestic  monopoly,  domestic  competition  will  reduce 
prices  to  their  natural  level. 

We  say,  therefore,  that  Adam  Smith,  beginning  right,  ended 
wrong,  by  leaping  to  conclusions,  which  his  premises  would  not 
justify  ;  and  that  all  his  followers  have  plunged  into  the  same  mis- 
take. They  have  assumed  monopoly,  where  there  is  none;  and 
restriction  where  there  Is  none,  except  as  the  undoubted  right  of 
one  nation  against  another.  But  they  assert  a  domestic  restriction, 
which  can  not  be  found,  and  a  hardship  in  the  raising  of  prices  to 
consumers,  when.  In  the  case  of  the  United  States,  as  we  have 
proved  elsewhere,  the  prices  are  reduced.     It  does  not  belong  to 


188       PROTECTION  NOT  RESTRICTION,  BUT  EMANCIPATION. 

US  to  prove,  that  this  is  the  fact  in  other  quarters  ;  though  we  think, 
as  a  general  rule,  it  may  be. 

It  must  be  evident  to  those  who  are  competent  to  consider  the 
case,  that  restrictions  in  international  commerce,  do  not  of  course 
create  restrictions  in  domestic  trade.  On  the  contrary,  as  shown 
above,  in  the  case  of  the  United  States,  the  former  are  absolutely 
necessary  to  rescue  domestic  trade,  that  is,  capital  and  labor,  in  all 
their  functions,  from  foreign  restrictions  of  a  very  grave  and  serious 
character. 

What,  then,  do  the  advocates  of  Free  Trade,  in  the  United 
States,  ask  for  ?  Precisely  the  same  thing  which  Protectionists 
demand,  to  wit,  the  free  and  unrestrained  use  of  American  capital 
and  labor.  The  only  difference  is  about  the  mode  of  attaining  to 
that  end.  We  have  shown  here,  and  in  other  parts  of  this  work, 
that  the  only  way  is  by  a  protective  system.  It  is  a  misnomer, 
therefore,  to  call  it  a  restrictive  system,  when  there  is  no  such  thing 
in  it.  The  design  and  tendency  of  an  American  protective  system, 
is  not  to  embarrass,  but  to  disembarrass,  American  capital  and  la- 
bor; to  rescue  and  shield  them  from  foreign  oppression  ;  to  encour- 
age them  ;  to  bring  them  out ;  to  open  the  way  for  their  most  profit- 
able employment ;  and  to  make  them  entirely  free. 


MONEY.  189 


CHAPTER   XIII. 

MONEY. 

Barter,  its  Nature  — Origin  of  the  Phrase,  '■  Precious  Metals." — How  Gold  and  Silver  eame 
to  be  used  hs  Money. — Gold  not  u.^ed  as  Money  in  all  Paris  of  the  World. —  Reljitive 
Proportions  of  the  Precious  Metals  employed  as  Money  and  for  other  Piirpo.«es. — Foun- 
dation of  the  Value  of  Gold  and  Silver,  when  used  as  Money. —  Turgot,  Say.  MCulIoch, 
and  others,  on  this  Point — The  Foundation  of  the  Value  of  Money  lies  in  the  Demand 
of  the  Precious  Metals  for  other  Uses. —  It  is  a  Foundation  in  Nature,  not  tlie  Result  of 
Convention. — Defiuition  and  Functions  of  Money. 

Barter,  or  the  exchange  of  one  commodity,  unrepresented,  for    ^--^-^J^ 
another,  is  the  natural,  and  was  the  original  mode  of  trade.      That         •.    ..^^ 
is,  one  man,  being  in  possession  of  a  thing,  no  matter  what,  which 
another  wants  more  than  he  does  ;  and  the  other  being  in  posses- 
sion of  a  thing,  no  matter  what,  which  the  first  wants  more  than  the  -^ 
second  does ;  they  agree  to  exchange,  and  do  exchange,  on  such 
terms  as  may  be  arranged  between  them.     This  is  barter.     It  is 
true,  that  this  definition  includes  money,  or  its  material,  as  a  com- 
modity.    It  is  impossible  to  give  a  definition  of  barter,  without  a 
comprehension  of  this,  as  a  possible  result.     But  money,  with  its 
present  attributes  and  functions,  was  not  originally  in  use,  and  is 
the  result  of  social  improvement,  or  of  the  convenience  and  neces- 
sities of  society. 

In  process  of  time,  of  which  the  memory  of  man  and  history  give 
no  advice,  certain  metals,  commonly  called  gold  and  silver,  having 
been  discovered,  and  found  to  possess  excellent  and  unrivalled 
qualities  for  certain  uses,  and  for  ornament,  became  "precious." 
This  may  be  supposed  to  be  the  origin  of  the  name,  ^^prrcious 
metals."  For  certain  purposes  of  use  and  ornament,  other  things 
have  been  held  much  more  valuable  even  than  gold  and  silver,  and 
for  which  ten,  twenty,  a  hundred,  and  even  a  thousand  to  one,  in 
weight,  of  the  "  precious  metals"  have  been  and  are  given,  as  an 
equivalent.  Nevertheless,  partly  on  account  of  their  scarcity,  and 
especially  on  account  of  their  adaptation  to  so  many  useful  and  or- 
namental purposes,  no  other  substances,  original,  or  however  formed, 
have  ever  acquired  the  position  of  being  held  so  universally  "pre- 
cious," as  gold  and  silver. 

And  it  is  to  be  observed,  that  this  view  does  not  bring  us  to  their 


190  MONEY. 

position  and  use  as  money.     Gold  and  silver  are  not  valuable,  sim- 
ply because  they  are  money.     This  was  not  the  original  ground  of 
their  being  held  in  such  high  esteem  ;  but  they  have  been  adopted, 
and  have  obtained  universal  consent,  to  be  used  as  money,  or  a 
common   medium  of  exchange,  because  of  their  value   for  other 
uses,  and  because  they  are  always  in  demand  for  such  a  vast  vari- 
ety of  appropriations,  other  than  money.    Money  is  but  one  of  their 
uses,  later  in  the  order  of  things ;  and  it  is  only  a  fraction  of  their 
value  that  is  created  by  their  use  as  money,  in  the  same  manner 
as  anything  else  is  increased  in  value,  in  proportion  as  its  uses  are 
multiplied.     The  real  foundation  of  the  value  of  gold  and  silver, 
may  be  said  to  be,  was  in  fact,  prior  to  their  having  been  viewed 
in  tlie  light  of  money,  and  appropriated  to  that  use ;  and  the  cause 
of  their  being  thus  appropriated,  was  doubtless  the  discovery,  by 
experience  and  observation,  of  their  unrivalled  qualities  for  other 
uses  and  in  other  applications.     Time  and  immemorial  usage,  there- 
fore, have  assigned  to  them  the  functions  of  money,  apparently  for 
ever,  without  the  remotest  probability  of  change.     Nevertheless, 
this  was  not  an  accident,  was  not  arbitrary ;  but  there  were  sub- 
stantial, fundamental  reasons,  of  the  nature  of  value,  lying  some- 
where back,  beyond.     Gold  and  silver  could  not  even  now  retain 
their  value  as  money,  but  for  the  foundation  on  which  they  fall  back 
and  rest,  as  being  greatly  valuable  for  an  almost  infinite  variety  of 
other  purposes,  which  are  always  ready  to  take  up  and  absorb 
them,  whenever  they  can  be  spared  from  trade,  and  which,  as  a 
part  of  trade,  is  constantly  being  done  ;  and  as  a  part  of  trade  also, 
they  are  as  constantly  going  back  into  the  forms  or  into  the  uses 
of  money,  though  not  in  so  great  amount.     The  natural  current 
from  the  bowels  of  the  earth,  is  to  the  other  uses  of  gold  and  sil- 
ver ;  and  only  so  much  of  them  is  arrested,  on  the  passage,  for 
money,  as  the  necessities  of  trade  require.     It  is  only  in  distress, 
that  people  will  surrender  their  plate,  trinkets,  or  any  other  "  pre- 
cious" things,  composed  of  gold  or  silver,  for  money. 

Although  the  high  value  of  gold  and  silver  appears  to  have  been 
appreciated,  in  the  earliest  stages  of  society  of  which  we  have  any 
account,  the  world  was  slow  in  adopting  them  to  discharge  the 
functions  of  money,  or  of  a  common  currency,  as  they  now  do, 
throughout  the  civilized  world  ;  and  even  down  to  this  day,  Jacobs* 
says:    "Gold  has  been  rarely  used  in  Asia,   as   money,   either 

•  William  Jacobs,  Esq.,  F.R.S.,  "  An  Inquiry  into  the  Production  and  Con- 
sumption of  the  Precious  Metals,"  2  vols.,  London,  1831. 


MONEY.  191 

coined  or  uncoined."  He  also  says  :  "  Silver  is  said  to  have  been 
first  coined  in  Rome,  in  the  year  of  its  building  485,  or  2GG  years 
before  our  era  [Christian"].  The  first  gold  coin  of  Rome  followed 
that  of  silver,  after  an  interval  of  62  years." 

When  the  Hebrew  nation  became  rich,  they  displayed,  under 
Solomon,  great  accumulations  of  gold  and  silver.  But  silver  only 
was  used  in  commercial  exchanges  ;  gold  for  ornamental  purposes, 
as  also  silver.  Solomon  used  gold  profusely  in  decorating  the 
royal  residence,  and  the  temple. 

In  the  empire  of  Japan,  to  this  day,  gold  is  apparently  used  as 
plentifully  as  in  the  days  of  Solomon,  according  to  Jacobs,  for  the 
decoration  of  public  and  other  buildings,  and  is  prodigally  laid  on 
their  furniture;  but  it  is  not  used  as  money,  either  there,  or  in 
China,  comprehending,  in  this  particular,  other  parts  of  the  East. 

All  parts  of  the  world  have  produced  the  precious  metals,  more 
or  less ;  and  when  the  richest  sources  have  been  discovered,  they 
seem  always  to  have  been  worked,  till  so  much  exhausted  as  not 
to  pay  cost.  They  once  abounded  in  different  parts  of  the  Roman 
empire.  All  know  somewhat  of  the  mines  of  Mexico  and  South 
America.  At  the  present  time,  Russia  is  producing  gold  in  con- 
siderable abundance,  reported  at  an  average  of  $12,000,000  an- 
nually for  six  years  previous  to  1846,  and  $17,000,000  for  that 
year. 

It  would  be  impossible  even  to  conjecture,  with  any  tolerable 
reliance,  the  number  of  uses  to  which  gold  and  silver  are  applied, 
other  than  of  money.  Jacobs  says:  "One  of  the  greatest  causes 
of  the  consumption  of  gold,  is  the  use  of  it  in  smaller  personal 
ornaments,  and  in  the  variety  of  trinkets,  whose  basis  is  gold.  It 
is  supposed  that,  in  both  England  and  France,  the  quantity  of  the 
precious  metals  applied  to  these  minor  purposes,  by  far  exceed 
that  which  is  converted  into  larger  objects.  Silver  teaspoons  in 
England,  may  be  counted  by  millions,  perhaps  by  hundreds  of 
millions."  Jacobs  estimates  that  fths  of  the  silver,  brought  to 
Europe  from  1700  to  1810,  was  manufactured  in  similar  articles 
of  household  furniture.  Who  can  count  the  gold  in  watches, 
finffer-rinss,  bracelets,  and  other  ornaments  of  the  head,  neck, 
bosom,  and  person.  In  the  courts  of  Europe,  some  men  might  be 
said  to  be  encumbered  whh  the  mere  weight  of  gold  displayed  on 
their  persons.  The  gold  and  silver  absorbed  by  churches,  found 
upon  and  around  the  altars,  have  not  been  small  in  amount,  and 
are  always  deemed  the  richest  prey  of  spoilers. 


192  MOxNEY. 

Adam  Smith  seems  to  have  thought,  that  the  gold  and  silver, 
used  up  by  manufacturers,  in  his  time,  were  equal  to  the  whole 
annual  product.  He  rates  the  gold  and  silver  plating  and  gilding 
at  Birmingham,  in  that  time,  at  <£50,()00  a  year.  Jacobs  says: 
*'  A  degree  of  destruction  of  gold  and  silver,  which  was  scarcely 
felt  in  the  ancient  world,  has,  in  modern  times,  been  steadily  and 
rapidly  advancing,  and  must  at  length  produce  a  sensible  effect  on 
the  value  of  all  commodities."  He  also  says,  that,  when  America 
was  discovered,  Europe  produced  the  precious  metals  as  fast  as  it 
consumed  them;  that,  in  63  years  after  that  event,  50  per  cent, 
was  added  to  the  general  stock  ;  and  150  per  cent,  from  1599  to 
1699.  The  amount  he  allows  for  Europe,  at  the  discovery  of 
America,  is  ^35,000,000;  and  in  1599,  ^155,000,000.  One 
hundred  and  fifty  per  cent,  on  this,  for  the  next  hundred  years, 
would  raise  the  stock  in  Europe,  for  1699,  to  .£487,500,000, 
which  has  been  increasing  ever  since,  though  not  very  sensibly  for 
the  last  half  century,  till  the  gold  of  Russia  seems  to  have  revived 
the  impetus.  The  highest  amount  of  gold  and  silver  coin  which 
Jacobs  allows  for  Europe  and  America,  is  =£380,000,000,  for 
1809,  since  which  it  has  declined,  at  the  rate  of  £40,000,000  in 
twenty  years,  which  is  doubtless  owing,  partly  to  the  decreased 
product  of  the  mines,  partly  to  the  use  of  paper-money,  and  partly 
to  the  great  demand  for  these  metals  in  other  applications,  and  to 
the  multiplication  of  those  uses.  The  increasing  product  of  the 
Russian  gold  may  be  regarded  as  opportune  for  the  commercial 
world,  to  sustain  the  body  of  the  currency  in  that  material,  which 
is  most  convenient  of  the  two. 

Some  economists  pretend,  that  the  amount  of  currency  is  not  of 
material  importance,  as  the  prices  of  commodities  are  regulated 
accordingly.  It  is  at  least  desirable  that  there  should  not  be 
sudden  and  great  fluctuations  in  this  amount,  as  such  changes 
affect  the  value  of  the  income  of  different  classes  of  society  very 
unequally.  For  example,  when  the  great  abundance  of  the  pre- 
cious metals  derived  from  the  American  mines  had  raised  the 
general  price  of  the  necessaries  and  comforts  of  life  as  4  to  1  of 
what  they  were  before,  it  was  a  hard  case  for  nonproducers  of  such 
commodities,  whose  position,  though  occupied  in  other  industrial 
and  useful  pursuits,  obliged  them  to  live  on  the  same  amount  of 
money  as  before. 

The  relative  proportion  of  the  precious  metals  converted  into 
money,  as  compared  with  that  absorbed  by  all  other  uses,  seems  to 


THE    FOUNDATION    OF    THE    VALUE    OF    MONEY.  193 

have  increased,  from  the  early  ages,  with  the  growing  demands  of 
commerce.  Jacobs  says:  "  Taking  the  amount  of  coined  money 
at  thirty  millions  [sterling],  we  should  calculate  the  remainder  of 
the  two  metals  [in  England]  at  sixty  millions,"  or  two  of  llie  latter 
to  one  of  the  former.  He  also  applies  this  rule  to  France.  M'Cul- 
loch,  in  an  article  in  Brande's  Dictionary,  says  the  coin  of  Great 
Britain  "is  at  least  sixty  millions."  But  for  Europe  and  America 
together,  Jacobs  makes  the  proportion  three  for  money  to  four  for 
other  uses.  In  another  place,  however,  he  allows  that  the  value 
of  "three  or  four"  is  found  in  England,  in  other  forms,  to  one  of 
money  ;  and  that,  from  1810  to  1830,  the  other  uses,  throughout 
the  world,  absorbed  more  than  what  came  from  the  mines.  He 
also  says:  "Current  coin  in  Europe  and  America  diminished,  be- 
tween 1S09  and  1829,  from  ^-380,000,000  to  ^320,000,000." 
It  may,  perhaps,  be  concluded,  that  the  proportion  now  existing 
in  other  forms,  in  Europe  and  America,  is  as  three  to  one  of  money. 
But  the  comparative  amount  of  the  precious  metals  employed  in 
the  world  as  money,  is  an  accident  of  history,  arising  from  the  ex- 
tent and  demands  of  commerce,  since  they  have  been  so  appropri- 
ated ;  and  does  not  at  all  affect  the  question  of  the  foundation  of 
their  value  in  the  form  of  money. 

Assuming  that  nothing  is  money  but  gold  and  silver,  or  that 
which  will  command  them  at  the  will  of  the  holder,  it  may  be  re- 
marked, that  the  universal  credit  of  these  substances,  when  used 
as  money,  must  have  a  foundation.  That  foundation  is  usually 
called  intrinsic  value.  But  a  little  reflection  will  show  that  the 
value,  thus  asserted,  lies  farther  back  than  the  use  of  these  metals 
as  money,  not  denying  that  this  use  is  a  fraction  of  their  value. 
But  how  came  they  to  be  used  as  money?  Davanzati,  an  Italian 
economist  of  high  repute,  says  :  "  Gold  and  silver,  being  found 
to  be  of  no  use  in  supporting  human  life,  have  been  adopted,"  &c., 
that  is,  appropriated  to  the  use  of  money.  This,  we  should  think 
too  puerile  to  be  noticed,  except  for  the  gravity  with  which  it  has 
been  cited  by  others.  M.  Turgot  answers  this  question  :  "  By 
the  nature  and  force  of  things."  But  this  answer,  as  must  be 
seen,  has  no  more  point  in  it  than  the  surface  and  materials  of  cre- 
ation, inasmuch  as  it  has  all  this  range.  Others  answer :  By  rea- 
son of  their  qualities.  This  is  not  denied,  so  far  as  those  qualities 
determine  their  intrinsic  value,  which  brings  us  back  to  where  we 
started  from.  But  it  is  said,  they  mean  the  adaptation  of  their 
qualities  to  this  specific  use  ;  which  has  some  reason  in  it,  but 

13 


194  THE    FOUNDATION    OF    THE    VALUE    OF    MONEY. 

more  a^-alnst  it.  Tlie  very  authorities  who  give  this  reason,  be- 
cause, forsooth,  they  must  give  some  reason,  such  as  M'Culloch, 
overturn  it  by  starting  objections,  and  proving  the  great  incon- 
venience and  expense  of  these  quaHties,  in  such  an  appropriation 
of  these  substances. 

The  truth  is,  gold  and  silver  were  proved  to  be  valuable,  highly 
so,  and  always  in  demand,  before  they  were  used  as  money. 
They  were  found  to  be  remarkable  for  their  beauty  and  utility,  and  to 
excel  all  other  substances  for  the  number  of  uses  in  which  they  were 
held  in  high  esteem,  no  matter  whether  for  utility  or  fancy,  as 
both  these  ends  impart  value  or  command  price  ;  and  the  longer 
and  better  that  they  have  been  known,  tried,  and  compared,  so 
much  more  stern  and  abiding  has  been  the  proof  of  their  excellence, 
and  so  much  greater  the  number  of  uses  to  which  they  have  been 
appropriated,  and  for  which  they  have  been  in  request.  These  are 
facts  which  run  back  through  all  history,  and  are  without  contra- 
diction ;  and  the  growth  of  history  on  this  point,  as  to  both  materials 
and  time,  only  tends  to  verify  them.  Gradually,  in  the  course  of 
time,  and  by  the  exigencies  of  society,  they  came  to  be  appropri- 
ated, by  general  consent,  to  the  uses  of  money,  till  at  last  that  con- 
sent became  universal  in  the  civilized  world.  This  appropriation, 
therefore,  was  ulterior  and  consequent  to  the  ascertainment  of  the 
many  useful  and  admirable  qualities  of  these  metals  for  other  pur- 
poses;  without  which,  there  is  no  probability  that  they  would  have 
been  employed  as  money. 

Turgot  says,  "  The  precious  metals  became  universally  money, 
not  in  consequence  of  any  arbitrary  agreement  among  men,  or  of 
the  intervention  of  any  law,  hut  by  the  nature  and  force  of  things.'''' 
That  it  was  "not  in  consequence  of  any  arbitrary  agreement,"  is 
well  said,  though  M.  Say  seems  to  think  otherwise.  It  is  no  less 
true  that  law  can  not  make  money,  or  force  credit  into  anything, 
to  make  it  pass  for  money.  Our  continental  money,  the  French 
assignats,  and  other  attempts  of  the  kind,  with  which  history 
abounds,  are  in  point.  But  Turgot,  like  every  thinking  man,  felt 
the  necessity  of  finding,  at  least  of  asserting,  the  foundation  of  the 
value  of  money.  And  what  is  it  ?  "  The  nature  and  force  of 
things  !"  But  "  the  nature  and  force  of  things"  is  so  indefinite,  so 
obscure,  and  so  mystical,  that  one  is  so  far  from  being  enlightened 
by  such  a  definition,  as  to  be  thrust  into  greater  darkness.  Instead 
of  having  the  foundation  pointed  out,  one  is  introduced  into  the 


THE    FOUNDATION    OF    THE    VALUE    OF    MONEY.  195 

wide  creation,  to  find  it  as  he  can.  No  doubt  it  is  somewhere  in 
this  field. 

M.  Say  says:  "Money  is  indebted  for  its  currency,  not  to  the 
authority  of  government,  but  to  its  being  a  commodity  bearing  a 
peculiar  and  intrinsic  value."  The  use  of  the  word  "  peculiar" 
here,  is  a  sufficient  indication  that  M.  Say  was  not  prepared  to 
go  any  farther ;  that  it  was  a  mere  refuge  ;  for,  in  such  a  con- 
nexion, on  such  a  topic,  it  is  obscure  and  mysterious,  scarcely,  if 
at  all,  more  explicit  and  definite  than  Turgot's  "  nature  and  force 
of  things."  And  yet  it  is  a  subject,  a  point,  on  which  we  can  not 
afford  to  be  left  in  the  dark.  It  is  the  foundation  of  a  monetary 
system  that  we  are  now  in  search  of;  which  is  one  of  the  most 
important  branches  of  public  economy.  M.  Say  also  observes: 
"If  they  [gold  and  silver]  were  never  used  in  plate  or  jewellery, 
money  would  grow  cheaper."  By  "  plate  and  jewellery"  here, 
he  evidently  intends  to  comprehend  all  the  uses  of  these  metals, 
other  than  that  of  money  ;  for  he  adds  :  "  The  employment  of  the 
precious  metals  in  manufactures,  makes  them  scarcer  and  dearer 
as  money ;"  M.  Say  actually  stood  here,  with  his  foot  on  the  very 
foundation  of  the  value  of  money,  recognised  it  in  terms,  and  yet 
he  did  not  seem  to  know  he  was  there.  For  he  does  not  even 
raise  the  question  whether,  but  takes  for  granted  that  gold  and  sil- 
ver would  have  been  used  as  money,  if  they  had  not  been  appro- 
priated to  these  other  objects.  It  is  marvellous  that  he  should  say, 
"  their  employment  in  manufactures  makes  them  scarcer  and  dearer 
as  money,"  when  in  fact  these  other  uses  constitute  the  only  foun- 
dation of  their  value  and  use  as  money.  It  is  true,  indeed,  that 
these  other  uses  make  them  "  scarcer,"  and  "  dearer."  But  M. 
Say  takes  for  granted  they  would  have  been  used  as  money, 
independent  of  these  other  uses. 

M'Culloch  says  :  "  The  union  of  the  different  qualities  of  the 
comparative  steadiness  of  value,  divisibility,  durability,  facihty  of 
transportation,  and  perfect  sameness,  in  the  precious  metals,  doubt- 
less formed  the  irresistible  reason  that  has  induced  every  civilized 
community  to  employ  them  as  money."  Here,  again,  is  not  the 
least  approximation  to  the  true  question,  except  as  it  is  assumed. 
What  is  required  is,  to  have  it  solved.  No  doubt  "  steadiness  of 
value"  was  a  reason,  and  the  reason.  But  how  came  it  with  that 
"  steadiness  of  value"  ?  The  other  four  consecutive  reasons  are 
comprehended  in  the  first,  and  compose  it,  as  to  the  money  charac- 
ter of  gold  and  silver.     These  qualities,  however,  can  be  found  in 


196  THE    FOUNDATION    OF    THE    VALUE    OF    MONEY. 

many  other  things.  The  qualities  of  gold  and  silver,  such  as  they 
are,  are  veiy  serious  objections  to  their  use  as  nnoney,  so  much  so 
that  they  are  kept  in  deposite,  as  much  as  possible,  and  the  great 
bulk  of  trade  and  conrjmerce  is  carried  on  by  a  substitute,  to  wit, 
paper.  So  far  from  having  a  "  facility  of  transportation,"  it  is  very 
inconvenient  and  expensive.  M'Culloch  himself  says,  on  the  third 
page  following  the  above-cited  passage,  "it  occasions  a  very  heavy 
expense."  Think  of  the  expense  of  bringing  twenty-five  millions 
of  dollars  of  specie  from  Europe  to  the  United  States,  in  1846  and 
1847,  as  a  balance  for  breadstuffs  required  in  Europe  by  famine. 
The  costs  of  insurance,  brokerage,  freight,  loss  of  interest  in  the 
meantime,  &c.,  could  not  be  covered  for  less  than  3^  per  cent., 
which,  as  will  be  seen,  amounts  to  $875,000.  And  as  this  impor- 
tation of  specie  into  the  United  States  was  forced  by  an  extraordi- 
nary and  providential  event,  it  is,  perhaps,  safe  to  consider  it  as  out 
of  place,  and  it  may  have  to  go  back  again.  A  boldness  of  impor- 
tation, based  on  this,  will  naturally  force  it  back,  to  cost  $875,000 
more;  or  in  all,  by  these  two  moves,  $1,750,000.  Such,  also,  is 
the  effect  of  removing  specie,  in  large  amounts,  from  one  part  of 
the  country  to  another.  Any  one  can  see,  that  paper  is  a  much 
more  convenient,  and  much  less  expensive  medium,  which  is  always 
resorted  to,  when  it  has  specie  as  a  basis  ;  but  for  want  of  it,  specie 
itself  must  travel.  The  transactions  of  six  of  the  New  York  banks, 
amounting  to  $60,000,000,  in  ten  days,  without  employing  over 
$200,000  of  specie,  noticed  in  Chapter  XVL,  show  how  utterly 
impossible  it  would  have  been  to  do  more  than  a  small  fraction  of 
that  business,  in  the  same  time,  with  specie.  The  qualities  of  gold 
and  silver,  therefore,  instead  of  being  a  reason  for  their  use  as 
money,  is  one  of  their  greatest  objections  —  certainly  a  great  one, 
and  a  very  expensive  inconvenience.  Besides  the  inconvenience 
and  cost  of  large  transfers  of  specie,  from  one  nation  to  another, 
and  from  one  point  of  the  same  country  to  another,  it  would  be  next 
to  impossible  to  transact  the  ordinary  small  trade  of  a  country  with 
specie,  between  points  requiring  remittances  ;  and  while  bank  paper 
is  convertible,  almost  everybody  prefers  it  to  specie,  and  employs 
it,  except  for  small  change.  Gold  and  silver  are  burdensome  in 
the  purse,  in  the  portmanteau,  and  in  the  trunk,  besides  being  a 
subject  of  anxiety,  when  one  has  charge  of  them,  at  home,  or  trav- 
elling. It  would  be  absurd  to  say,  that  people  object  to  have  them, 
as  owners,  for  they  are  of  recognised  value  ;  but  most  people  do 
not  like  to  have  them,  as  keepers,  on  account  of  the  inconvenience, 


THE    FOUNDATION    OF    THE    VALUE    OF    MONEY.  197 

risk,  and  cost  of  removal.  Their  qualities  are  a  serious  evil  for  the 
purposes  of  money.  How  absurd,  then,  to  assume,  that  they  are 
devoted  to  this  use,  on  account  of  their  qualities,  except  so  far  as 
they  are  adapted  to  other  uses,  which,  as  a  foundation,  constitute 
their  adaptation  to  this,  and  thus  overcome  the  objections  to  their 
inconvenience.  Their  adaptation  to  other  uses,  and  their  values 
in  those  uses,  are  undoubtedly  the  true  secret  of  the  founda- 
tion of  their  value  as  money.  They  began  to  be  used,  and  can 
only  continue  to  be  used,  as  money,  on  that  account.  The  evils 
of  their  qualities  as  money,  could  not  be  tolerated,  would  cause 
them  to  be  repudiated,  but  for  this  ;  but  on  account  of  this,  these 
evils  are  submitted  to  ;  they  are  not  a  recommendation.  The  rec- 
ommendation is  farther  back,  lies  deeper,  and  overcomes  these  ob- 
jections ;  and  not  only  overcomes  them,  but  makes  them  light  and 
preferable.  The  very  name,  distinctive,  of  these  metals, "  precious," 
comes  not  from  their  use  as  money;  but  from  their  other  numerous 
and  important  uses,  constituting  the  foundation  of  their  value.  This 
designation  of  ^'■'precious  metals,"  is  very  significant.  It  did  not 
come  by  chance;  but  is  founded  on  a  substantial  aggregate  value, 
which  never  has  failed,  and  never  can  fail,  in  any  probability;  be- 
cause the  uses  of  gold  and  silver  are  constantly  multiplying.  While 
one  is  superseded,  many  are  added.  Nobody  apprehends  the  fail- 
ure of  their  value.  The  experience  of  all  nations,  in  all  time,  has 
established  their  character  as  "precious,"  and  there  never  has  been 
manifested  a  symptom  of  the  giving  way  of  this  faith.  It  is  only 
confirmed  by  time  and  events.  Notwithstanding,  therefore,  all  the 
inconveniences  of  these  metals,  on  account  of  their  qualities,  when 
employed  as  money,  they  will  no  doubt  continue  to  fulfil  this  des- 
tiny, on  account  o^ihe  foundation  of  their  value  in  other  uses.  They 
who  possess  them,  will  ever  know,  can  never  doubt,  tliat  they  hold 
in  their  hands  the  best  possible  pledge  of  value. 

It  is  proper,  here,  to  rejnark,  that  the  inconveniences  of  gold  and 
silver,  as  a  currency,  are  increased  by  time,  as  civilization  advances, 
as  commerce  is  extended  and  increased,  and  as,  by  this  means,  the 
necessity  of  effecting  commercial  exchanges  with  the  greatest  pos- 
sible expedition,  and  in  great  amounts,  is  augmented.  For  this  and 
other  reasons,  many  eminent  economists  and  statesmen  have  ex- 
hausted their  wits  to  find  a  substitute.  Even  Ricardo  appears 
seriously  to  have  believed,  that  the  British  government  might  found 
a  currency  on  its  credit.  He  advocated  it,  if  we  are  rightly  in- 
formed, in  the  very  face  of  the  depreciation  of  the  bank  of  England 


198      THE  FOUNDATION  OF  THE  VALUE  OF  MONEY. 

paper,  during  its  suspension  of  cash  payments,  from  1797  to  1822. 
He  appears  to  have  based  his  theory  on  the  fact,  that  the  deprecia- 
tion was  no  more  ;  whereas,  we  think,  he  should  have  come  to  the 
opposite  conclusion,  from  the  fact  that  it  depreciated  so  much.  That 
credit  is  itself  a  currency,  in  one  sense,  and  to  a  great  extent,  is 
undoubtedly  true;  but  it  must  have  a  foundation.  It  is  this  very 
foundation  which  we  are  now  inquiring  for,  to  wit,  the  foundation 
of  the  value  or  credit  of  gold  and  silver,  as  money,  as  the  medium 
of  trade.  All  seem  to  admit,  that  it  is  not  in  its  character  as  mon- 
ey ;  for  who  of  the  econon)ists,  it  may  be  asked,  has  ever  yet  got 
farther  than  Turgot  in  this  investigation,  who  laid  this  foundation 
*'  in  the  nature  and  force  of  things"  ?  Clearly  that  can  not  be  sat- 
isfactory. 

And  yet  a  knowledge  of  the  foundation  of  the  value  of  money  is 
not  less  important  for  an  inteMigeni  view  of  the  whole  subject,  thare 
is  a  knowledge  of  the  foundation  of  anything  else  that  can  be  named, 
to  a  right  view  of  it.  Branches  of  truth,  in  such  a  practical  mat- 
ter, may,  doubtless,  be  seen,  and  correctly  stated,  without  this  knowl- 
edge ;  but  no  philosopher  should  be  satisfied,  till  he  has  got  to  the 
bottom  of  his  subject ;  and  he  is  liable  to-  error,  if  he  does  no6 
find  it. 

"  The  sole  reason,"  says  M.  Say,  "why  a  man  elects  to  receive 
the  coin,  in  preference  to  every  other  article,  is,  because  he  has 
learnt  from  experience,  that  it  is  preferred  by  those,  whose  products 
he  has  occasion  to  purchase.  Crown-pieces  derive  their  circulation! 
as  money  from  no  other  authority  than  this  spontaneous  preference. 
Custom,  therefore,  [originating  in  an  accident,]  designates  the  spe- 
cific product  that  shall  pass  exclusively  as  money.  The  choice 
of  the  material  is  of  no  great  importance,  whethei"  it  be  gold 
or  silver,  leather  or  paper.  .  .  The  value  of  gold  and  silver  is 
arbitrary,  and  is  established  by  a  kind  of  mutual  accord  in  every 
act  of  trade."  Is  not  this  very  astonishing?  It  will  be  observed, 
that  we  do  not  arraign  the  alleged  force  of  custom  in  the  case 
which  is  always  a  blind  leader;  but  the  question  is,  what  was 
the  original  foundation  of  this  custom?  Custom,  certainly,  is 
a  better  reason  for  an  ignorant  man,  than  for  a  philosopher,  who 
professes  to  give,  not  only  the  reason  why  money  has  credit,  but 
why  it  originally  obtained  credit,  as  a  common  medium,  and  why- 
it  has  maintained  it,  from  time  immemorial,  with  all  the  world, 
without  experiencing  the  least  possible  diminution  or  disturbance? 
There  must  have  been  a  time  when  this  use  of  gold  and  silver,  as 


THE    FOUNDATION    OF    THE    VALUE    OF    MONEY.  199 

money,  had  not  so  much  the  power  of  custom ;  and  there  never 
was  a  time,  when,  as  a  mere  custom,  it  would  not  have  been  dis- 
turbed, if  it  had  not  a  more  substantial  basis ;  if,  indeed,  it  had  not 
a  foundation  in  reason,  in  philosophy,  in  every  consideration,  that 
would  stand  the  scrutiny  of  all  men  and  all  minds  addicted  to  in- 
quiry, so  as  to  baffle  every  possible  effort  to  impair  that  credit. 
Custom  is  not,  can  not  be,  a  reason  for  such  a  fact.  There  is  not, 
perhaps,  a  subject  within  the  scope  of  human  investigation,  the  true 
basis  of  which,  for  the  practical  purposes  of  life,  is  more  important 
to  be  understood,  than  that  of  money,  or  the  knowledge  of  which 
is  more  essential  to  a  true  theory  of  public  economy,  so  far  as  it 
relates  to  the  currency.  Most  truly  did  M.  Say  remark  :  "  The 
first  principles  of  political  economy  are  as  yet  but  little  known. 
Ingenious  systems  and  reasonings  have  been  built  upon  hollow 
foundations."  Here  is  nt)t  only  a  "  first,"  but  a  fundamental 
*' principle,"  entirely  unknown  to  himself;  and  his  own  "ingenious 
reasoning,"  on  this  vital  and  fundamental  question,  is  not  "  built 
upon  a  hollow  foundation  ;"  but  it  has  no  foundation  at  all. 

M.  Say  observes  truly  :  "  To  enable  it  [money]  to  execute  its 
functions,  it  must,  of  necessity,  be  possessed  of  inherent  and  pos- 
itive value."  But,  surely,  its  value  must  lie  somewhere  else  than 
in  its  character  as  money  ;  or,  in  other  words,  something  else  must 
have  made  this  gold  eagle,  and  this  silver  dollar  valuable.  Time 
was,  when  they  were  not  money  ;  now  they  are  ;  there  must  have 
been  some  other  reason  for  their  adoption,  than  that  money  was 
wanted.  Say,  these  metals  are  scarce ;  there  are  many  things 
more  so.  Say,  they  are  convenient  for  this  use,  on  account  of  their 
qualities ;  there  are  other  substances  not  ill  and  some  much  better 
adapted,  in  these  attributes,  for  such  an  appropriation;  and  allow- 
ing, that  these  useful  qualities,  added  to  their  scarcity,  impart  a 
substantial  value  to  gold  and  silver  as  money ;  which  is  not  denied  ; 
still  the  value  for  which  they  are  credited,  relative  to  that  of  other 
commodities  most  necessary  to  man,  is  in  great,  prodigious  dispro- 
portion, independent  of  other  considerations.  Say,  that  this  dis- 
proportion is  convenient  to  all  parties,  to  all  the  world.  That  may 
be,  doubtless  is,  true.  It  is,  then,  an  arbitrary  value — a  fraud ! 
The  world  has  cheated  itself,  and  reckons  it  a  good  bargain ! 

It  is  evident,  self-evident,  that  gold  and  silver,  as  money,  must 
have  had  a  value  to  start  with,  and  as  a  reason  for  being  able  to 
start.  This  is  the  point,  and  all  that  is  claimed.  To  suppose  that 
the  world   has  been  swindled,  or  swindled  itself,  into  the   belief, 


200     THE  FOUNDATION  OF  THE  VALUE  OF  MONEY. 

that  money  has  a  value,  which,  after  all,  is  factitious;  and  that  it 
should  be  satisfied  with  tliis  persuasion,  on  the  principle  that  it  is 
a  convenient  delusion,  is  not  more  absurd  than  contrary  to  M.  Say's 
own  doctrine,  when  he  says,  "  a  system  of  swindling  can  never  be 
long  lived,  and  must  infallibly  in  the  end  produce  much  more  loss 
than  profit."  It  is  not  easy  to  believe,  that  the  world  has  been 
thus  cheated,  and  that  the  credit  of  its  circulating  medium  does  not 
rest  on  a  ba'sis  entirely  independent  of  itself.  It  is  the  very  nature 
of  credit  to  have  a  basis.  To  say  that  intrinsic  value  is  the  basis, 
is  precisely  what  we  maintain.  Intrinsic  value  for  what?  It  is 
not  the  idea  or  function  of  money,  that  constitutes  intrinsic  value  ; 
but  it  is  that  which  qualifies  for  the  function  ;  and  the  qualifying 
power  lies  back  of  money  itself,  is  underneath  it,  is  its  foundation. 
But  why  adopt  an  absurdity  without  cause  ?  Why  hold  debate 
here,  when  the  numerous  and  important  values  of  gold  and  silver, 
for  other  uses,  are  so  palpable,  quite  enough  to  recommend  them 
for  the  offices  of  money,  and  quite  sufficient  to  sustain  them  in  the 
discharge  of  these  functions?  In  this  light,  society  is  safe,  and 
the  good  sense  of  mankind  is  vindicated,  in  adopting  the  "precious 
metals"  as  a  common  currency.  It  would  be  most  unpleasant  to  be 
obliged  to  believe  that  money  is  a  fraud  —  or  even  that  the  use  of 
it  is  a  self-imposed  deception. 

But  it  is  not,  perhaps,  very  strange  that  an  economist,  who,  like 
M.  Say,  holds  that  the  value  of  paper  money  does  not  depend 
upon  its  being  convertible  into  specie  on  demand,  should  also 
maintain  that  the  esteem  in  which  gold  and  silver  are  held,  as 
money,  is  arbitrary  —  the  effect  of  custom. 

Without  doubt,  gold  and  silver  employed  as  money,  constitute 
one  of  the  values  of  these  metals,  and  that  not  unimportant ;  but 
the  foundation  on  which  they  started  as  money,  the  causes  which 
summoned  them  to  this  position,  to  these  important  functions  of 
society,  and  of  the  commercial  world,  will  be  found  only  in  values 
of  an  older  date  ;  and  the  causes  which  still  sustain  their  credit  as 
money,  will  also  be  found  in  the  same  old  values,  and  in  a  multi- 
tude of  others  since  added,  and  continually  augmenting,  as  the 
uses  to  which  these  metals  are  applied,  other  than  that  of  money, 
are  multiplied  in  the  progress  of  time,  and  in  the  advances  of 
civilization.  It  was  never  an  accident,  nor  a  sura  or  concatenation 
of  accidents ;  it  was  never  an  arbitrary  fit,  nor  an  arbitrary  law  of 
society,  that  lifted  gold  and  silver  into  the  position,  and  installed 
them  in  the  functions  of  money  ;  it  was  not  custom ;  it  was  not 


THE  FOUNDATION  OF  THE  VALUE  OF  MONEY.     201 

even  the  necessity  of  a  common  medium  of  trade  that  selected  them 
for  this  duty,  though  that  necessity  was  urgent ;  but  it  was  a  sub- 
stantial value  imparted  to  them  by  time  and  events,  destined  never 
to  be  diminished,  but  always  to  increase;  it  was  "the  nature  and 
force,"  not  "of  things"  in  general,  as  Turgot taught,  but  of  these 
very  things  in  particular;  it  was  their  own  position,  their  own  force 
and  nature,  their  own  value,  independent  of  and  prior  to  that  of 
money,  that  made  them  money.  As  a  law  of  society,  which  grew 
up  with  society,  it  could  no  more  be  resisted  than  a  law  of  nature. 
It  was  not  a  choice  which  men  made  ;  but  a  necessity  into  which 
they  were  forced  ;  and  not  a  necessity  to  have  this  or  an  alternative 
at  their  own  will ;  but  to  have  this,  and  nothing  else.  There  was 
no  more  uncertainty  hanging  over  the  predestined  use  of  gold  and 
silver  as  money,  than  over  the  course  of  the  heavenly  bodies.  The 
law  in  one  case  is  as  forcible  as  that  in  the  other  ;  and  both  are 
ascertainable  and  definite.  One  is  the  attraction  of  gravitation  ;  the 
other  the  intrinsic  value  of  gold  and  silver  for  other  uses. 

If  we  wish  to  ascertain  the  additional  value  which  gold  and 
silver  have  acquired  in  their  use  as  money,  we  know  of  but  one 
rule,  which,  though  it  may  not  be  accurate,  is  worth  something. 
In  China,  Japan,  and  some  other  portions  of  the  Eastern  world, 
gold  is  not  used  as  a  currency,  but  silver  only.  Take,  then,  the 
relative  value  of  these  metals  in  Europe  and  America,  where  both 
are  used  as  money,  and  in  those  quarters  where  silver  only  is  thus 
employed,  and  the  difference  may  perhaps,  be  assumed  as  the  pro- 
portion of  value  which  they  have  acquired  by  their  use  as  money. 
In  Europe  and  America,  the  value  of  gold  is  to  that  of  silver  as 
15  to  1,  with  a  small  additional  fraction  in  favor  of  the  former. 
In  China,  the  value  of  gold  is  quoted,  by  some  authorities,  as  12 
to  1  of  silver ;  by  others  as  low  as  10  of  the  former  to  1  of  the 
latter.  In  .Japan,  the  value  of  gold  is  cited  by  some  as  9  to  1,  by 
others  as  8  to  1  of  silver.  If  the  medium  difference  in  these 
quarters  be  assumed  as  10  to  1,  then  the  value  added  to  these 
metals  by  their  use  as  money,  is  equal  to  one  half  of  their  value 
for  all  other  uses.  It  ought  to  be  by  much  the  greatest  value,  as 
compared  with  that  imparted  to  gold  and  silver  by  any  other  single 
use,  because  it  is  by  far  the  most  important. 

Money  may  be  defined  as  the  commo7i  medium  of  trade,  or  of 
commercial  exchanges.  Or  it  may  be  called  the  standard  medium 
of  trade. 


202  DEFINITION    AND    FUNCTIONS    OF    MONEY. 

We  have  purposely  and  scrupulously  excluded  from  this  def- 
inition all  other  ideas,  which,  by  various  authorities,  have  been 
put  into  the  definition  of  money,  particularly  such  as  its  being  a 
measure  of  value,  which,  at  first  sight,  would  be  received  by  almost 
all  persons  as  a  correct  and  necessary  part  of  the  definition. 

A  man  on  'change  buys  stock  of  one  person,  at  95  per  cent.,  and 
turnin<>-  on  his  heel,  sells  it  to  another  at  95 L  Which  is  the 
measure  of  value,  since  both  can  not  be?  The  buyer  who  buys 
to  sell,  for  the  sake  of  profit,  always  buys  at  one  price,  and  sells  at 
another  and  higher  if  he  can.  In  all  exchanges,  prices  are  con- 
tinually fluctuating.  Which  is  the  measure  of  value?  These 
examples  are  perhaps  enough  to  show,  that  the  definition  of  money 
as  being  the  measure  of  value,  or  when  this  is  made  a  part  of  the 
definition,  leads  to  an  absurdity. 

We  think  M.  Say  has  clearly  proved  that  money  is  not  the 
measure  of  value,  by  the  simple  suggestion,  that  measure  supposes 
an  invariable  rule,  as  for  example,  in  measures  of  capacity,  of 
superficies,  of  length,  and  of  weight.  Invariability  is  so  important, 
that  the  law  makes  it  a  fraud  and  criminal  offence  to  use  false 
measures  in  trade.  But  prices  are  constantly  fluctuating.  Money 
exj^resscs  prices,  and  eff"ectuates  exchanges;  but  it  does  not  meas- 
ure prices.  Its  functions  cease,  when  it  has  expressed  them,  and 
effectuated  the  trade.  It  can  go  no  farther.  The  measure  of 
value  is  the  agreement  of  parties  as  to  price,  in  any  particular 
transaction ;  and  for  public  purposes  of  the  market,  the  prices 
current  are  the  nearest  measures  that  can  be  found.  If  persons 
would  learn  to  distinguish  between  the  expression  and  the  measiire 
of  values,  they  would  find  themselves  at  the  end  of  this  question. 
The  agreement  of  parties  determines,  and  money  expresses  values. 
The  agreement  is  the  measure  of  value,  as  between  them,  and  it  is 
expressed  in  the  established  denominations  of  money.  So  in  all 
cases  of  actual  exchanges.  So  in  prices  current  of  the  market. 
The  sole  functions  of  money,  as  such,  are  to  express  values,  and 
to  effectuate  exchanges  as  a  quid  py-o  quo. 

We  define  money,  therefore,  as  the  common  medium  of  trade,  and 
find  in  it  two  simple,  but  important  functions,  one  to  express  values, 
and  the  other  to  consummate  commercial  exchanges,  by  being 
given  on  one  side,  and  accepted  on  the  other,  as  the  consideration 
thus  agreed  upon.  It  is  a  medium  as  the  instrument ;  it  is  common^ 
because  the  world  has  so  ordained. 


MONEY.  203 


CHAPTER    XIV. 

MONEY. 

The  Distinction  between  Money  as  a  Subject  and  as  the  Instrnment  of  Trade. — Review 

of  the  Doctrine  of  Adam  Smith  and  others  on  the  Relative  Position  of  Money  and  of  the 
Commodities  given  for  it. — Adam  Smith  versus  Adam  Smith. — Price  the  Attribute  of 
Commodities,  not  of  the  Money  given  for  them. — Smith  and  Others  on  this  Point — Error 
and  Confusion  of  their  Doctrine. — Weight  the  Measure  of  Money. — Effect  of  the  Dis- 
covery of  America  on  Prices. — Professor  Twiss'  "  View  of  the  Progress  of  Political 
Economy,  since  the  16th  Century." — Mr.  Twiss  meets  the  Point,  and  puts  all  at  Stake. — 
Examiuation  of  his  Position. 

Having  defined  money,  determined  what  is  the  foundation  of 
its  value,  and  ascertained  its  functions,  it  is  now  proposed  to  mark 
the  distinction  between  money  as  a  subject,  and  money  as  the  in- 
strument of  trade,  then  to  follow  out  its  results.  This  distinction  is 
one  of  great  importance,  not  simply  because  it  is  a  fact,  connected 
with  a  very  important  subject,  but  more  especially  because  the  fact 
itself  is  entitled  to  more  influence  on  the  question  between  Free 
Trade  and  Protection  than  any  other,  perhaps,  that  could  be  named. 
It  is,  indeed,  in  our  opinion,  of  itself  alone  fully  adequate  to  decide 
that  question.  Whether  this  be  a  reason  that  has  induced  the 
Free-Trade  economists  to  keep  this  distinction  out  of  view,  or 
whether  they  have  fallen  into  their  great  error  because  they  did  not 
discern  it,  we  do  not  undertake  to  decide.  It  is  true  that  it  has 
been  recognised,  incidentally,  by  Adam  Smith,  and  by  others  of 
his  school,  as  it  was  impossible,  certainly  not  easy,  to  avoid  it ;  but, 
whenever  the  proper  place  for  its  influence  turns  up,  it  is  carefully 
kept  out  of  sight,  all  is  silence,  except,  in  one  recent  and  notable 
instance,  Mr.  Twiss,  who  faces  the  principle,  and  denies  its  ap- 
plication, by  forcing  upon  it  a  misnomer,  as  we  shall  presently  see. 

We  proceed  to  the  distinction.  The  Free-Trade  economists, 
Adam  Smith  and  his  school,  say,  that  money  is  a  commodity,  and 
that  it  occupies  the  same  position  in  trade  as  other  commodities. 
We  grant,  that  it  is  a  commodity,  and  that  as  a  subject  of  trade,  it 
occupies,  as  they  say,  the  same  position  as  other  commodities. 
But  we  deny,  that  it  discharges  the  functions  of  money,  and  hold 
that  it  is  merely  passive,  when  it  is  the  subject  of  trade.  Gold 
and  silver,  in  passing  from  the  mines  to  market,  buUion  in  the 


204  DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT, 

market,  and  all  manufactured  articles  which  are  composed  in  whole 
or  in  part  of  the   precious  metals,  are  subjects   of  trade.     The 
same  may  be  said  of  coin,  bank-notes,  and  negotiable   paper  of 
every  kind,  when  bought  and  sold.     Bankers   and  money-brokers 
trade  exclusively  in   money,  and  money  in   their  hands,   and  in 
whatever  form,   coming  or  going,   is   always   a  subject  of  trade. 
The  precious  metals,  in  bullion  or  in   coin,  passing  through  the 
hands   of  brokers,  from   one  country  to  another,  are  subjects  of 
trade,  while  in  the  hands  of  those  dealers,  though  they  may  be  at 
the  same  time  discharging  the  functions  of  money  between  debtor 
and  creditor,  who  employ  bankers  and  brokers  as  agents  of  remit- 
tance.    All  notes  discounted  at  bank,  are  subjects  of  trade,  in  the 
transaction,  both  to  the  lender  and  to  the  borrower.     Bills  of  ex- 
change, bonds  and  mortgages  transferred,  and  many  other  descrip- 
tions of  credit,  for  which  a  consideration  is  paid,  are  subjects  of 
trade.     All  who  borrow  credit  for  a  consideration,  buy  it.     It  is  a 
subject  of  trade  in  the  transaction.     Gold  and  silver,  in  all  other 
forms  than  that  of  money,  are  subjects  of  trade.     So  far  as  these 
and  many  other  forms  and  conditions  of  money  and  of  credit  go, 
and  so  far  as  the  precious  metals  are  devoted  to  other  objects  than 
money,  as  subjects  of  trade,  we  agree  with  the  Free-Trade  econ- 
omists, that  they  occupy  the  same  position  as  other  and  all  other 
commodities  exchanged  in  trade. 

But,  it  must  be  observed,  that  money,  in  its  own  proper  func- 
tions, as  such,  has  had  nothing  to  do  with  all  this,  except  so  far  as 
the  considerations  rendered  in  these  transactions  are  concerned, 
as  for  example,  the  discount  and  interest  of  a  note.  They  are 
merely  the  preparatory  stages,  through  which  money  passes,  the 
platform  on  which  it  is  tossed  about,  in  a  merely  passive  state,  as  a 
subject  of  trade,  till  it  reaches  the  great  field  of  the  commercial 
world,  where  it  is  destined  and  designed  actively  to  discharge  the 
appropriate  functions  of  money.  This  is  a  field,  before  which  the 
Free-Trade  economists  have  held  up  a  screen.  Let  us  go  behind 
it,  and  see  how  money  operates  there,  in  distinction  from  the  man- 
ner in  which  it  is  operated  upon  as  a  subject  of  trade,  before  it 
gets  there. 

A  consideration  of  the  difference  of  destination  of  money,  and  of 
the  thino-s  for  which  it  is  exchanged,  as  the  medium  of  trade  in  this 
field,  will  cast  light  on  this  point.  The  destination  of  money  here, 
is  for  an  endless  round  of  duty,  in  the  discharge  of  the  same  func- 
tions ;  whereas  the  destination  of  the  subjects  of  its  agency  in  trade, 


AND    AS    THE    INSTRUMENT    OF    TRADE.  205 

is  either  for  consumption,  or  for  a  fixture  in  the  disposition  of  per- 
manent capital,  so  called,  but  yet  often  perishable.  Money  is 
employed  as  the  instrument  to  carry  them  on  to  their  respective 
destinations,  where  they  must  soon  arrive,  perhaps  by  the  first 
transaction  ;  but  whether  by  one  or  more,  money  is  the  agent,  and 
they  are  the  passive  subjects.  But  the  functions  of  money  in  this 
field,  never  cease  ;  it  will  never  have  done  its  work  ;  its  destina- 
tion is  perpetual  employment  in  the  same  offices ;  and  while  the 
things  on  which  it  operates,  are  constantly  passing  away  by  con- 
sumption, or  arriving  at  their  final  destination  as  fixtures,  by  the 
agency  of  money,  money  itself  is  constantly  returning  to  its  duty 
in  moving  on  other  commodities,  in  endless  succession,  to  their 
destinations.  Money,  in  this  field,  is  the  moving  power,  without 
which  nothing  else  would  move,  so  far  as  trade  is  concerned,  except 
in  the  way  of  barter,  which,  properly  does  not  belong  to  civilization. 
And  yet  Adam  Smith,  Say,  Ricardo,  M'Culloch,  and  others  of 
that  ilk,  tell  us,  that  money  and  a  piece  of  calico  are,  commercially 
considered,  the  same  thing,  and  occupy  the  same  position,  in  a 
commercial  transaction,  when  one  is  exchanged  for  the  other;  and 
they  tell  us,  that  it  is  no  matter,  whether  a  nation  parts  with  one  or 
the  other,  so  that  trade  goes  on.  Unfortunately  for  a  nation,  and 
fortunately  for  the  truth,  the  absurdity  comes  to  light,  when  the 
money  is  all  gone  and  trade  will  no  longer  go. 

We  submit,  then,  whether  the  distinction  between  money  as  a 
subject  and  as  the  instrument  of  trade,  is  not  clearly  made  out,  as 
definite,  substantial,  and  necessarily  influential  as  to  the  matters  in 
question. 

When  and  wherever  there  is  a  want  of  money,  trade  comes  to  a 
halt.  The  interest  of  every  party,  therefore,  a  man  or  a  nation, 
concerned  in  trade,  is  to  take  care  not  to  be  out  of  money,  for  it  is 
his  "tools  of  trade."  And  how  does  such  a  party  get  out  of 
money,  if  it  had  any  ?  It  can  only  be  by  buying  more  than  is 
sold  of  other  commodities,  which  are  prized  and  moved  by  money, 
and  by  being  obliged  to  setde  balances  with  cash.  When  the 
trade  of  a  party  comes  to  this,  and  the  store  of  cash  is  exhausted, 
trade  must  slop,  barter  only  excepted,  which  is  the  same  as  stop- 
ping, because  it  is  a  mode  of  trade  which  can  not  be  revived,  and 
which,  if  it  could,  can  not  now  be  employed  to  any  profitable 
extent. 

It  is  by  entirely  overlooking  this  distinction,  that  the  advocates 
of  Free  Trade  commit  their  fatal  error.     They  hold  that  money  is 


206         DIFFERENCE    BETWEEN    MONEY   AS    THE    SUBJECT, 

a  commodity,  and  that  it  is  exchanged  in  trade  as  such  ;  and  that 
consequently,  the  more  of  trade,  the  better,  whether  money  goes 
or  comes ;  or  whether  all  goes,  and  none  comes. 

But,  as  above  shown,  it  is  not  true,  when  gold  and  silver  are 
parted  with,  in  discharge  of  the  functions  of  money,  that  they 
occupy  the  same  position,  as  the  commodities  for  which  they  are 
given;  much  less  do  they  discharge  the  same  functions.  Strictly 
speaking,  the  commodities  thus  operated  upon  by  money,  discharge 
no  functions  at  all,  in  the  transaction  that  is  going  on,  but  are 
merely  passive.  Neither  the  world,  or  any  part  of  it,  has  ever  con- 
sented to  take  these  other,  or  any  other  commodities,  as  a  currency, 
as  money,  as  a  legal  tender.  The  consequence  is,  that,  when  a 
foolish  and  unwise  nation  has  parted  with  all  its  cash,  on  the  theory 
of  Free  Trade,  though  it  be  ever  so  rich  in  other  commodities,  it 
can  trade  no  more  ;  or  if  it  has  only  parted  with  enough  to  cripple 
its  commercial  position,  it  is  a  bad  business.  It  is,  therefore,  haz- 
ardous for  a  nation  to  part  with  its  money,  in  foreign  trade,  on 
the  principle,  that  it  can  be  bought  back  again  with  other  com- 
modities, as  certainly  and  as  easily  as  money  itself  can  buy  that 
which  is  in  market.  In  the  meantime,  when  there  has  been  an 
inconvenient  drain  of  money  to  foreign  parts,  how  is  the  nation  to 
carry  on  its  home  trade?  Doubdess,  by  waiting  long  enough,  and 
with  great  sacrifices,  the  money  will  come  back,  by  reversing  the 
mode  of  business,  in  selling  more  of  other  commodities  than  is 
bought ;  which  again  demonstrates  the  fallacy  of  the  doctrine,  the 
practical  operation  of  which  brought  the  nation  into  this  trouble. 

The  following  is  one  form  of  Adam  Smith's  argument  on  this 
point :  "  A  country  that  has  wherewithal  to  buy  wine,  will  always 
get  the  wine  which  it  has  occasion  for;  and  a  country  which  has 
wherewithal  to  buy  gold  and  silver,  will  never  be  in  want  of  these 
metals.  They  are  to  be  bought  for  a  certain  price,  like  all  other 
commodities  ;  and  as  they  are  the  price  of  all  other  commodities, 
so  are  all  other  commodities  the  price  of  these  metals.  We  trust 
with  perfect  security  that  the  freedom  of  trade,  without  any  atten- 
tion of  government,  will  always  supply  us  with  the  wine  which  we 
want ;  and  we  may  trust  with  equal  security,  that  it  will  always 
supply  us  with  all  the  gold  and  silver  which  we  can  afford  to  pur- 
chase or  to  employ,  either  in  circulating  our  commodities,  or  in 
other  uses." 

It  can  not  but  be  seen,  that  the  great  error  of  Adam  Smith  and 
his  school,  on  this  point,  is,  that  they  not  only  call  money  a  com- 


AND    AS    THE    INSTRUMENT    OF    TRADE.  207 

modlty  in  trade,  which  is  true  when  it  is  bought  and  sold,  and  is 
not  employed  as  money  ;  but  that  they  fail  to  consider  its  peculiar 
and  appropriate  functions  in  trade,  when  discharging  the  offices  of 
money.  They  do  not,  so  far  as  this  point  of  their  argument  is  con- 
cerned, allow  it  to  have  any  functions  at  all ;  but  represent  it  as 
passive,  like  the  commodity  for  which  it  is  exchanged,  in  any  par- 
ticular transaction.  But  gold  and  silver,  when  employed  as  money, 
are  taken  out  of  their  position  as  commodities  in  trade,  and  used  as 
an  agent  or  instrument  to  carry  on  trade.  They  are  technically, 
"  tools  of  trade."  In  this  capacity  or  function,  they  are  the  motive 
power  of  the  commercial  world.  They  do  not,  as  before  shown, 
in  the  discharge  of  this  office,  occupy  the  same  position  as  the  com- 
modities which  they  move,  in  the  act  of  being  exchanged  for  them. 
The  commodities  are  passive,  in  relation  to  this  act ;  and  money  is 
the  agent.  When  money  has  moved  one,  it  moves  another,  and 
so  on,  without  any  definite  limit ;  and  the  same  act  may  be  per- 
formed an  indefinite  number  of  times  every  day,  by  precisely 
the  same  sum  of  money,  in  application  to  as  many  different  com- 
modities. 

Adam  Smith  himself  was  aware  of  all  this,  as  he  could  not  but 
be,  and  as  the  following  citations  from  him'will  show:  "The  great 
wheel  of  circulation  is  altogether  different  from  the  goods  which 
are  circulated  by  means  of  it."  —  "Money,  the  great  wheel  of  cir- 
culation, the  great  insfrumerit  of  commerce,  like  all  other  instru- 
ments of  trade,  though  it  makes  a  part,  and  a  very  valuable  part  of 
the  capital,  makes  no  part  of  the  revenue  of  the  society  to  which  it 
belongs  ;  and  though  the  metal  pieces  of  which  it  is  composed,  in 
the  course  of  their  annual  circulation,  distribute  to  every  man  the 
revenue  which  properly  belongs  to  him,  they  make  themselves  no 
part  of  that  revenue ;"  that  is,  no  part  of  the  commodities  purchased 
by  them,  to  be  consumed  or  used.  —  "When  we  compute  the  quan- 
tity of  industry  which  the  circulating  capital  of  any  society  can  em- 
ploy, we  must  always  have  regard  to  those  parts  of  it  only,  which 
consist  in  materials,  provisions,  and  finished  work.  The  other, 
which  consists  in  money,  and  which  serves  only  to  circulate  these 
three,  must  always  be  deducted.  In  order  to  put  industry  into 
motion,  three  things  are  requisite :  materials  to  work  upon,  tools 
to  work  with,  and  the  wages  or  recompense  for  the  sake  of  which 
the  work  is  done.  Money  is  neither  a  material  to  work  upon,  nor 
a  tool  to  work  with  ;  and  though  the  wages  of  the  workmen  are 
commonly  paid  to  him  in  money,  his  real  revenue,  like  that  of  all 


208         DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT, 

Other  men,  consists,  not  in  the  money,  but  in  the  money's  worth  ;. 
not  in  the  metal  pieces,  but  in  what  he  can  get  for  them,"  to  wit, 
the  commodities  wanted. 

It  will  be  observed,  that  Adam  Smith,  here,  not  only  ascribes  a 
peculiar  function  to  money,  but  places  it  in  a  peculiar  position,  as 
is  right.  lie  does  not  rank  it  among  the  things,  or  commodities, 
exchanged,  but  endows  it  with  the  faculty  of  niaking  those  ex- 
changes, as  "  the  instrument,  as  the  great  wheel  of  circulation  ;" 
and  although  he  says  truly,  that  it  is  a  part,  and  a  very  important 
part,  of  the  capital  of  society  ;  nevertheless,  the  function  he  ascribes 
to  it  is  so  peculiar,  that  it  is  not  to  be  computed  with,  but  "  to  be 
always  JeJi/cfcd''''  from,  those  parts  of  "the  circulating  capital  of 
society,"  which  put  and  keep  industry  in  motion,  because  "  money 
serves  only  to  circulate"  those  other  parts.  This  is  its  function. 
Surely,  then,  Adam  Smith  himself  has  put  it  quite  far  asunder,  in 
its  position  and  functions,  from  the  things  which  it  "circulates,"  or 
acts  upon  —  quite  far  enough  for  our  present  purpose. 

Let  us,  then,  return,  and  try  Adam  Smith  by  Adam  Smith.  He 
says  :  "  A  country  which  has  wherewithal  to  buy  wine,  will  always 
get  the  wine  which  it  has  occasion  for."  Very  good.  He  adds  : 
"And  the  country  which  has  wherewithal  to  buy  gold  and  silver, 
will  never  be  in  want  of  these  metals."  No  one  can  fail  to  see, 
that  he  has  here  begged  the  question,  as  a  step-stone  to  his  conclu- 
sion; in  other  words,  has  asserted  an  identical  proposition  —  a  mere 
truism.  The  "  wherewithal"  is  the  thing  required,  and  having,  by 
hi/jiothesis,  put  the  country  in  possession  of  that,  to  start  with,  of 
course  it  ought'  to  do  well  enough.  If  the  country  has  money,  or 
anything  else  which'  the  wine-makers  want,  or  which  a  third  party 
will  take  for  the  wine,  it  can  get  it ;  but  if  the  wine  can  only  be 
had  with  money,  then  money  is  the  only  "  wherewithal"  to  buy  it. 
Parties  in  trade  are  not  to  be  forced.  Commercial  transactions 
have  always  to  do  with  two  wills  and  two  interests,  at  least. 
Money  is  the  only  thing  that  will  buy  everything  else.  A  man  may 
have  plenty  of  substantial  capital,  and  yet  not  find  it  easy  to  buy 
money  with  it,  if  he  has  been  so  unwise  as  to  get  out  of  money. 
He  is  in  absolute  peril  of  bankruptcy,  if  his  position  requires 
money ;  at  best,  he  is  embarrassed. 

But  this  is  not  the  end.  He  says:  "They,"  gold  and  silver, 
"  are  to  be  bought  for  a  certain  price,  like  all  other  commodities." 
This  seems  very  plausible,  and  in  one  sense,  is  true.  But  it  will 
be  observed,  that  he  does  not  use  the  term  money  here,  but  gold 


AND    AS    THE    INSTRUMENT    OF    TRADE.  209 

and  silver;  and  that,  instead  of  inve^iting  them  with  the  peculiar 
attributes  he  has  ascribed  to  money,  in  the  passatres  above  cited,  he 
puts  them  in  the  same  class  and  position  with  all  other  commodi- 
ties, not  as  agents,  but  as  subjects  of  trade  ;  not  to  l)uy  and  sell 
with,  but  as  things  to  be  bought  and  sold ;  and  it  is  true,  that  gold 
and  silver,  when  not  used  as  money,  occupy  that  position.  Rich 
men  and  rich  nations,  in  a  prudent  way  of  living,  can.  easily  buy 
gold  and  silver,  as  subjects  of  trade,  and  are  accustomed  to  do  it ; 
but  tho-e  men  and  tho:^e  nations,  who,  by  mismanagement,  have  got 
embarrassed,  though  they  may  have  other  capital  in  abundance, 
can  not  do  it  so  easily.  Here  is  the  distressing  point  of  Adam 
Smith's  hypothesis.  If  his  reasoning  avails  anything  in  the  case, 
it  is  intended  to  represent,  that  a  man  or  a  nation  that  has  traded 
so  freely  as  to  get  out  of  money,  is  just  as  well  off  as  the  man  or 
the  nation  that  has  taken  care  to  keep  enough  money  in  bank  to  do 
business  with  !      Is  it  not  so? 

But  he  is  involved  in  a  still  greater  absurdity.  He  adds:  "And 
as  they,"  gold  and  silver,  "  are  the  price  of  all  other  commodities, 
so  all  other  commodities  are  the  price  of  these  metals."  Let  us 
put  this  proposition  in  another  form,  and  see  how  it  will  look  : 
"And  as  they,"  gold  and  silver,  "will  purchase  all  other  commodi- 
ties, so  will  all  other  commodities  purchase  gold  and  silver."  No 
one  will  deny,  that  this  is  a  fair  statement  of  the  case  ;  for  it  is  the 
very  case  ;  nor  will  any  deny,  that  it  is  untrue ;  absolutely  untrue, 
as  a  reliable  condition,  in  the  experience  of  life.  It  is  because 
money  is  the  only  common  currency  of  the  world.  What,  then,  is 
a  nation  to  do,  that  has  traded  so  freely  as  to  get  rid  of  all  its 
money  ?  Why,  simply,  take  a  new  start,  trad€  more  prudently  in 
future,  and  under  great  inconveniences  and  with  immense  sacri- 
fices, get  up  again,  as  every  man  is  obliged  to  do,  who,  by  trading 
in  the  same  loose  way,  has  got  into  the  same  trouble. 

This  is  only  one  of  a  multitude  of  instances,  in  which  Adam 
Smith  and  his  school  reason  precisely  in  the  same  way,  whenever 
they  approach  the  doctrine  of  Free  Trade.  Adam  Smith  could 
not  but  be  right,  as  seen  above,  when  he  was  talking  about  the  po- 
sition and  functions  of  money,  in  negotiating  exchanges  ;  and  he 
could  not  but  be  wrong,  when  he  turned  his  back  on  that  reasoning, 
and  undertook  to  show,  that  it  was  just  as  well  for  a  nation,  or  a 
man  of  business,  to  be  without  money,  as  to  have  it  at  command. 

But  let  Adam  Smith  answer  Adam  Smith  yet  farther  on  this 
point :  "  The  merchant  generally  finds  it  more  easy  to  buy  goods  with 

14 


210        DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT, 

money,  than  to  buy  money  with  goods.  .  .  Money  is  the  known 
and  estabHshed  instrument  of  commerce,  for  which  everything  is 
readily  given  in  exchange;  but  which  is  not  always  witb  equal 
readiness  to  be  got  in  exchange  for  everything.  .  .  When  the  mer- 
chant's goods  are  upon  hand,  he  is  more  liable  for  such  demands 
for  money  as  he  may  not  be  able  to  answer,  than  when  be  has  got 
their  price  in  his  coffers.  He  is  more  anxious  to  exchange  his 
goods  for  money,  than  his  money  for  goods.  A  merchant,  with 
abundance  of  goods  in  his  warehouse,  may  be  ruined  by  not  being 
able  to  sell  them  in  time."  It  is  true,  foreseeing  the  application 
of  this  reasoning,  he  adds  :  "  A  nation  or  a  country  is  not  liable  to 
the  same  accident."  A  nation  is,  nevertheless,  liable  to  precisely 
the  same  accident,  as  our  own  experience  proves,  in  the  examples 
hereafter  cited  in  this  work.  But  Adam  Smith  confesses  that  "  the 
nation  in  such  a  case  might  suffer  some  loss  and  inconvenience, 
and  be  forced  upon  some  of  those  expedients  which  are  necessary 
for  supplying  the  place  of  money."  This,  surely,  is  enough  from 
him,  to  answer  himself.  He  was  right  in  saying  that  "  the  quantity 
of  coin  in  every  country  is  [should  be]  regulated  by  the  value  of 
the  commodities  to  be  circulated  by  it ;"  but  he  was  wrong  when 
he  said  it  was  just  as  well  to  have  less  than  enough,  as  enough  for 
this  object ;  and  he  was  right  again  when  he  confessed  that  for 
want  of  enough,  "  a  nation  might  suffer  inconvenience  and  loss, 
and  be  forced  upon  some  of  those  expedients  which  are  necessary 
for  supplying  the  place  of  money."  So  generally,  when  Adam 
Smith  is  wrong  in  one  place,  he  sets  Adam  Smith  right  in  another; 
but  the  misfortune  is,  that  many  take  his  wrong  for  right. 

M.  Say  observes  :  "  If  the  merchant  finds  the  precious  metals  a 
more  profitable  foreign  remittance  than  another  commodity,  it  is 
likewise  the  interest  of  the  state  to  remit  in  that  form  ;  for  the 
state  can  only  gain  and  lose  in  the  persons  of  its  individual  subjects  ; 
and  in  the  matter  of  foreign  commerce,  whatever  is  best  for  the 
individual  is  best  for  the  state  also." 

One  is  astonished  to  find  him  saying  in  a  note  to  this  averment, 
that  "  this  position  applies  to  foreign  commerce  only.  The  mo- 
nopoly profits  of  individuals,  in  the  home  market,  are  not  entirely 
national  gains."  Smith  and  all  the  economists  —  not  excepting 
Say  himself,  when  he  is  himself — admit,  that,  in  the  home  trade, 
the  nation  retains  both  the  values  exchanged,  as  well  as  the  profits 
on  both  sides;  whereas,  in  the  foreign  trade,  it  realizes  only 
one  side  of  the  double  benefit.     Observing  the  word  "  monopoly" 


AND    AS    THE    INSTRUMENT    OF  "TRADE.  211 

here  lugged  in  by  force,  as  it  evidently  is,  we  have  been  forcibly 
struck  with  the  suspicion  that  M.  Say  had  some  special,  personal 
reasons  for  such  a  violation  of  sound  reasoning.  To  maintain  that 
the  nation  is  a  gainer,  when  the  merchants  are  enriched  by  such 
excessive  importations  as  to  drain  the  country  of  its  specie,  and  as 
a  consequence  to  paralyze  all  branches  of  business,  and  at  the 
same  time  to  say  tliat  "  the  profits  of  individuals  in  the  home  mar- 
ket are  not  entirely  national  gains,"  when  both  values  exchanged 
are  retained,  with  the  profits,  "monopoly"  or  not,  is  somewhat 
more  than  an  absurdity.  The  sly  use  of  the  cant  word  "  monopoly" 
here,  was  unbecoming  the  dignity  of  a  philosophical  debate.  A 
man  in  a  passion  may,  perhaps,  be  excused  for  not  pi-otecting  him- 
self in  argument,  as  well  as  for  want  of  reason  in  his  protestations. 
The  fallacy  of  the  main  proposition  above  cited,  may  be  thus 
shown.  A  man  owes  a  debt,  and  is  obliged  to  pay  it,  or  be  dis- 
honest, or  turn  bankrupt.  In  this  sense,  it  is  his  interest  to  pay  ; 
at  the  same  time,  it  may  be  very  inconvenient.  A  nation,  by  over- 
trading with  foreign  parts,  in  buying  more  than  it  sells,  through  its 
merchants,  owes  a  debt  to  foreign  parts,  at  one  or  more  points  ; 
and  that  debt  is  obliged  to  be  paid.  The  merchants  who  created 
this  debt,  and  who  make  the  remittances,  have,  w^e  will  suppose, 
made  their  fortunes.  And  the  doctrine  of  Say  is,  that  the  nation 
can  not  be  benefited  less  than  the  amount  of  benefit  to  these  mer- 
chants. These  merchants  have  got  rich  by  selHng  their  goods  to 
the  people  ;  the  people,  having  paid  for  the  goods,  and  consumed 
them,  are  minus  both  the  money  and  the  goods  ;  the  merchants 
have  got  a  part  of  this  money,  and  are  rich  ;  foreign  parts  have 
got  the  other  portion,  being  the  major  part  of  it,  and  the  nation  is 
minus  that  major  part,  and  the  goods,  too,  which  are  consumed  in 
food,  drink,  clothing,  and  in  other  ways.  M.  Say  holds  that  the 
nation  is  richer  ;  and  as  much  richer  as  the  profits  of  these  mer- 
chants. Can  anybody  see  how  that  is?  If  the  imports  had  been 
permanent  capital,  and  gone  into  the  improvements  of  the  country, 
and  if  the  nation,  after  paying  the  balance,  had  money  enough  left 
for  its  trade,  one  can  see  a  national  benefit.  But  this  is  not  the 
case.  M.  Say,  and  all  of  his  school,  hold,  that,  in  all  cases,  ab- 
solutely and  unconditionally,  the  nation  is  benefited,  enriched,  by 
exchanges  abroad,  though  the  buying  exceeds  the  selling,  and 
though  the  balances  are  settled  by  cash  ;  or  rather,  to  present  the 
theory  in  their  own  form,  they  aver  that  the  buying  can  not  exceed 
the  selling  ;  and  that  it  makes  no  difference  whether  a  nation  parts 


212        DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT, 

with  cash  in  trade,  or  with  other  commodities  ;  nor  what  proportion 
the  cash  parted  with,  may  bear  to  that  received.  If  money  is 
given,  they  say,  it  is  only  a  commodity,  and  that  really,  there  is  no 
balance  in  the  case  ;  but  accounts  are  even,  and  all  parties  are  ben- 
efited. 

Here,  as  will  be  seen,  is  the  great  error  we  have  been  endeav- 
oring, among  others,  to  expose,  viz.,  overlooking  the  peculiar  po- 
sition and  functions  of  money  in  trade,  and  ranking  it  with  all  other 
commodities,  in  every  particular,  as  a  subject  of  trade.  In  that 
view,  M.  Say's  conclusion  is  correct ;  but  the  doctrine,  reduced  to 
practice,  can  not  but  be  fatally  erroneous,  with  nations  as  well  as 
with  individuals.  Unless  a  nation  has  mines,  like  the  states  of 
Mexico  and  South  x\merica,  and  trades  in  the  precious  metals  as 
indigenous  products,  it  can  not  generally  afford  to  buy  of  other 
commodities  than  money,  more  tiian  it  sells,  and  pay  the  balance 
in  money.  Our  own  commercial  history,  as  exhibited  in  subse- 
quent parts  of  this  work,  is  all  the  argument  that  need  be  offered 
here,  if  an  appeal  to  common  sense  were  insufficient. 

"  A  View  of  the  Progrcsn  of  Political  Ecovnmy  in  Europe,  since 
the  I6th  Centnry,^''  by  Travers  Twiss,  London,  1847,  lately  pub- 
lished, as  a  course  of  lectures  at  the  university  of  Oxford,  is  wor- 
thy of  some  notice.  Like  the  British  economists  generally.  Pro- 
fessor Twiss  is  of  the  school  of  Adam  Smith.  It  may,  however, 
be  observed,  that  this  "View,"  &c.,  taking  the  confession  of  the 
author  in  his  preface  —  the  truth  of  which  is  sufficiently  demon- 
strated by  the  production  itself — is  entirely  a  one-sided  view.  He 
candidly  says:  "I  have  attempted  to  assign  to  the  chief  writers 
their  due  shares,  respectively,  in  furthering  the  progress  of  sound 
opinions  ;  but  I  have  purposely  omitted  the  names  of  many  authors 
of  eminence  who  have  struggled  to  retard  that  progress,"  &c. 
One  can  not,  therefore,  after  such  a  confession,  expect  a  very  fair 
"  view"  of  this  department  of  history,  from  such  a  hand. 

Having  repeatedly  recognised  the  distinction  which  we  have 
made  in  this  chapter,  between  money  as  a  subject  and  as  the  in- 
strument of  trade  —  though  not  in  the  same  terms  which  we  em- 
ploy to  designate  it,  nor  for  the  same  purpose  —  unlike  his  brethren 
of  the  same  school,  Mr.  Twiss  has  presumed  to  face  this  principle, 
while  on  the  subject  of  what  is  commonly  called  the  balance  of 
trade,  and  flady  denies  that  it  has  any  application  here.  He  ob- 
serves :  "  If  it  be  said,  foreign  commodities  will  be  paid  for  with 
money  [so  far  as  the  imports  exceed  the  exports],  let  it  not  be  over- 


AND    AS    THE    INSTRUMENT    OF    TRADE.  213 

looked  that  the  gold  or  silver  which  is  given  in  exchange  for  for- 
eign commodities,  is  exchanged  away  as  a  commodity,  and  not  as 
money.  .  .  It  is  in  the  character  of  a  commodity,  that  gold  or  sil- 
ver becomes  an  article  of  foreign  commerce."  Here,  as  will  be 
seen,  is  the  same  old  song. 

We  are  heartily  glad,  that  any  member  of  the  Adam  Smith  school 
has  at  last  dared  to  face  this  point  of  the  main  question  ;  for  there 
are  many  points,  any  one  of  which,  properly  concluded,  is  decisive 
of  the  whole  ;  and  this  is  one  of  them.  Professor  Twiss  has,  man- 
ifestly, put  all  at  stake  here,  on  the  tenableness  of  his  assumption. 
If  money  remitted  from  a  nation,  to  setde  balances  run  up  by  an 
excess  of  imports  over  exports,  taken  as  a  whole,  is,  in  that  trans- 
action, discharging  the  functions  of  money,  and  is  not  a  mere  sub- 
ject of  trade,  as  averred  by  JMr.  Twiss,  all  other  arguments  for 
Free  Trade  are  of  no  avail.  It  is  lost  on  the  cast  of  this  single  die. 
Let  us  see. 

First,  as  to  what  we  concede.  We  concede,  that  money,  in 
passing  from  one  nation  to  another,  is  weighed  in  the  scales,  as  the 
common  currency  of  the  world.  But  this,  in  effect,  is  also  true  of 
every  coin,  in  its  domestic  round,  as  a  legal  tender.  The  mint  as- 
says determine  its  weight  and  degree  of  purity,  and  it  is  legalized 
only  on  that  assumption.  The  law  weighs,  and  the  mint  declares 
the  weight,  to  save  the  public  the  trouble  ;  and  the  currency  of  any 
coin  whatever,  in  a  given  state,  is  authorized  precisely  on  the  same 
principle,  which  regulates  the  currency  of  gold  and  silver  between 
nations.  Next,  we  concede,  that,  generally  —  we  have  no  objec- 
tion to  admit,  that,  universally — there  is  a  commercial  agency  em- 
ployed in  the  remittance  of  money  from  one  nation  to  another  ;  that 
that  agency  is  paid  for  this  service  ;  and  that  the  money,  in  the 
hands  of  this  agency,  from  the  time  it  is  received  at  home  and  paid 
abroad,  is,  so  far  as  the  agency  is  concerned,  a  subject  of  trade. 

But,  observe,  that  precisely  the  same  is  true  of  a  remittance  from 
New  York  to  New  Orleans ;  or  from  the  latter  to  the  former  city  ; 
or  from  any  one  city  or  place  in  the  Union,  to  any  other  place  or 
city,  when  it  is  made  by  a  commercial  agency,  or  by  a  bill  of  ex- 
change. In  the  hands  of  this  agency,  and  so  far  as  it  has  to  do 
with  it,  the  money  is  a  subject  of  trade,  because  the  agent  is  paid 
for  doing  the  service.  We  think  Professor  Twiss  must  have  a  very 
bold  front,  to  Bay,  that  the  employment  of  this  intermediate  agency, 
in  whose  hands  the  money  is  a  subject  of  trade,  as  in  the  case  of 
every  broker's  or  banker's  business,  at  all  affects  the  position  or 


214        DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT, 

relations  of  the  debtor  and  creditor,  at  the  two  opposite  end:5  of  this 
transaction,  or  tends,  in  any  degree,  to  transform  the  creditor  into  a 
buyer  of  money,  when  he  receives  his  pay,  or  the  debtor  into  a 
seller  of  money,  when  be  remits  it.  And  yet,  this  transformation 
is  necessary,  to  justify  Mr.  Twiss's  assumption. 

But  we  are  willing  to  rest  this  question  on  a  rule  laid  down  by 
Mr.  Twiss  himself,  in  the  following  words:  "We  must  never  lose 
sight  of  the  fact,  that  gold  or  silver,  strictly  speaking,  is  never  pro- 
ductive, when  discharging  the  functions  of  money,  Ibut  only  when 
it  is  exchanged  as  a  con>modity."^  We  are  satisfied  with  this  rule^ 
and  onJy  regret,  that  the  economists  of  Mr.  Twiss^s  schooJ  had  not 
laid  it  down  fiom  the  beginnit7g,  as  it  wouM  have  saved  a  world  of 
debate.  It  marks  the  distinction  precisely  between  nf>oney  as  a  sub- 
ject and  as  the  instrument  of  trade.  >Surely,  Mr.  Twiss  would  not 
pretend,  that  the  profits  of  brokers  and  bankers,  as  agents  in  settling^ 
the  accounts  betv/een  debtors  and  creditors,  force  this  settlement,  as 
a  transaction  between  the  two  latter  parties,  into  an  act  oC  produc- 
tiveness. What  is  the  reward  of  the  debtor  for  paying,  or  of  the 
creditor  for  receiving,  the  amount  of  the  debt  ?  Does  the  former 
give  less,  or  the  latter  receive  more,  than  the  debt?  If  Mr.  Twiss 
should  insist,  that  the  profits  of  brokers,  bankers,  and  other  agents^ 
in  settling  foreiga  accounts,  annihilate  the  functions  of  money  in  the 
gold  and  silver,  so  remitted,  then  the  principle  applies  to  all  domes- 
tic settlements,  under  the  same  national  jurisdiction,  and  neither  he, 
nor  anybody  else,  wiH  ever  be  able  to  fi'nd  what  he  himself  acknowl- 
edges to  be  the  proper  functions  of  money  ;  for  v^^e  wil}  venture  to 
say,  that  no  account  was  ever  settled,  and  no  money  ever  paid, 
without  expense  to  at  least  one  party,  and  consequendy  not  without 
a  con'esponding  benefit  to  some  other  party.  Sucb,  as  every  one 
will  see,  is  eqnal'ly  the  fict  in  negotiating^  domestic  as  foreign  bills 
of  exchange.  Men,  in  paying  debts,  will  always  take  the  cheapest 
way,  and  will  employ  secondary  or  intermediate  agencies,  as  little 
as  possible  ;  but  it  is  not  often  that  they  can  do  altogether  without 
them,  and  never  without  some  expense  of  time,  or  in  some  other 
way.  They  may  be  obliged  to  trade  off  money  under  par,  or  they 
may  have  money  worth  a  premium.  Does  the  sacrifice  in  the  for- 
mer case,  or  the  profit  in  the  latter,  both  of  which  involve  trading 
in  money,  annihilate  the  functions  of  money,  when  tbe  considera- 
tion is  rendered  to  satisfy  the  debt? 

It  may  be  observed,  as  a  general  rule,  that  money,  that  is  to  say, 
gold  and  silver,  in  any  considerable  quantities,  never  move  from 


AND    AS    THE    INSTRUMENT    OF    TRADE.  215 

one  remote  point  to  another,  as  between  New  York  and  New  Or- 
leans, or  between  Europe  and  America,  till  the  rates  of  exchange 
are  so  high  at  one  point  as  to  pay  the  agencies  of  remittance,  in- 
cluding insurance,  to  the  other.  Until  the  rates  of  exchanire  will 
defray  this  expense,  accounts  between  debtors  and  creditors  in  such 
remote  points,  are  adjusted  by  bills  of  exchange.  Whether  this 
adjustment  or  settlement  is  effected  by  bills  or  by  the  transfer  of 
bullion  or  specie,  the  transaction  between  the  debtor  and  creditor 
is  precisely  of  the  same  nature,  as  when  a  citizen  of  New  York,  with 
basket  in  hand,  pays  cash  for  the  materials  of  his  dinner  wiiich  he 
buys  in  the  market.  The  cash,  in  both  cases,  equally  and  alike 
(discharges  the  functions  of  money.  If  the  keeper  of  an  hotel  em- 
ploys a  caterer  to  go  to  market,  instead  of  going  himself,  the  wages 
of  this  agent  occupy  precisely  the  same  position  as  the  premiums 
on  exchange,  or  as  ilie  pay  for  the  transfer  of  specie,  between  New 
York  and  New  Orleans,  or  between  New  York  and  London.  None 
will  deny,  that  the  cash  used  in  the  former  case,  discharges  the 
functions  oi^  money ;  but  it  is  not  without  expense,  whether  the 
keeper  of  the  hotel  goes  himself  to  market,  or  employs  an  agent. 
All  these  intermediate  commercial  agents  are  parts  of  the  economy 
of  the  commercial  world;  and  the  reason  why  they  are  employed, 
8s  because  it  is  economy.  If  the  debts  from  New  York  to  New 
Orleans  are  so  much  greater  than  those  from  the  latter  to  the  former 
city,  as  to  pay  for  the  transfer  of  specie,  then  specie  travels  instead 
of  bills  of  exchange  ;  and  in  this  transfer,  it  discharges  the  func- 
tions of  money,  notwithstanding  that  the  transaction  is  productive 
to  the  agents.  The  same  is  the  case  in  the  transfer  of  specie  from 
one  nation  to  another.  Who  can  find  or  fairly  make  a  difference  ? 
Will  Mr.  Twiss  say,  that  the  twenty  or  twenty-five  millions  of 
dollars,  remitted  from  Europe  to  the  United  States,  in  1846  and 
1S47,  for  breadstufTs,  did  not  perform  the  functions  of  money,  be- 
cause it  was  productive  to  the  agents  of  the  transfer  ;  or  that  it  was 
no  disadvantage  to  Great  Britain  to  have  parted  with  so  much 
specie,  because  she  received  a  quid  pro  quo  in  return  ?  And  will 
he  say  this,  in  the  face  of  one  of  the  most  overwhelming  instances 
of  the  poverty  of  the  precious  metals,  with  which  the  British  empire 
was  ever  visited?  Yet,  according  to  his  doctrine,  and  that  of  the 
Adam  Smith  school,  this  twenty-five  millions  of  dollars  did  not 
come  from  Europe  to  the  United  States  as  money  ;  but  only  as  a 
commodity,  in  exchange  for  other  commodities.  Nay,  more: 
according  to  this  doctrine,   both  parties  were    benefited    by   the 


216        DIFFERENCE    BETWEEN    MONEY    AS    THE    SUBJECT 

trade.  The  famine  in  Ireland,  and  the  general  short  crops  of  Eu- 
rope, were  not  a  calamity  to  those  parts,  since  they  had  all  the 
profit  of  trading  away  the  commodities  of  gold  and  silver  for  the 
commodities  of  breadstufFs.  Such,  legitimately,  are  the  conclu- 
sions of  the  Adam  Smith  school.  But,  while  we  are  writing  this 
page,  October,  lS47,the  great  commercial  houses  of  Great  Britain, 
one  after  another,  in  rapid  succession,  are  tumbling  to  ruin  in 
lieaps,  like  as  a  circle  of  bricks  set  on  end,  near  enough  for  contact, 
when  one  falls,  the  whole  line  goes  down  in  succession  ;  and  with 
this  ruin  comes  universal  distress.  And  yet  Mr.  Twiss  says. 
Great  Britain  has  parted  with  no  money  ;  she  has  only  parted  with 
a  commodity  ! 

We  agree  with  IMr.  Twiss,  that  "  it  must  never  be  forgotten, 
that  the  capital  of  a  country,  which  is  employed  as  money,  is  not 
employed  as  an  instrument  of  production  ;  but  simply  as  an  instru- 
ment to  facilitate  the  exchange  of  other  capital."  But  when  he 
says  :  "  let  it  not  be  overlooked,  that  the  gold  or  silver,  which  is 
given  in  exchange  for  foreign  commodities,  is  exchanged  away  as 
a  commodity,  and  not  as  money,"  he  is  in  direct  contradiction 
with  the  above-cited  proposition  from  his  own  hand,  and  evinces, 
that  a  professor  of  Oxford  university  must  not  only  sympathize  with 
the  policy  of  the  British  government,  but  tiiat  he  is  forced  to  ex- 
/  ecute  its  behests,  in  violation  of  his  reasoning  powers,  peradven- 
ture,  of  his  conscience  ;  unless,  forsooth,  charity  should  allow,  that 
a  man's  social  connexions  may  exercise  dominion  over  his  judg- 
ment, as  is,  no  doubt,  sometimes  the  case.  But  Mr.  Twiss  him- 
self, against  himself,  as  almost  every  other  member  of  his  school 
has  done,  in  one  form  or  another,  has  confessed  the  true  doctrine, 
in  the  following  words  :  "  When  gold  or  silver  is  employed  as  an 
hxstnimnil  of  exchange,  it  is  employed  in  a  different  way  from  that 
in  which  it  is  generally  employed  as  a  commoditijy  Is  not  this 
surprising? 

We  have  endeavored  to  show,  in  another  chapter,  that,  from  the  , 
time  of  Adam  Smith,  including  him,  there  has  been  an  understand-  \ 
ing  between  the  British  government  and  British  writers  on  public 
economy,  as  to  the  doctrine  of  freedom  of  commerce,  which  is  not 
very  consistent  with  freedom  of  opinion  ;  and  it  was  not  to  be  ex- 
pected, that  a  British  university  would  go  against   British   policy. 

Granting,  however,  for  tlie  sake  of  argument,  that  gold  and  silver, 
remitted  to  settle  commercial  balances  against  a  nation,  does  not  go 
as  money,  but  only  as  a  commodity  ;  still,  it  can  not  be  denied, 


/ 


AND    AS    THE    INSTRUMENT    OF    TRADE.  217 

that  the  money  is  gone.  What,  then,  would  this  assumption  of 
Professor  Twiss,  or  our  concession  of  the  point,  avail  him?  "A 
rose,  by  any  other  name,  would  smell  as  sweet ;"  and  the  money 
of  a  nation,  remitted  to  foreign  parts,  to  pay  debts,  would  still  be 
a  calamity,  if  enough  should  not  be  left  for  the  trade  of  the  country ; 
and  we  do  not  understand  these  gentlemen  as  making  any  pro- 
vision for  such  a  coruingency,  or  for  any  contingency  whatever. 
Their  doctrine  is  absolute. 

There  is  an  habitual  mode  of  reasoning  with  Adam  Smith,  Ri- 
cardo,  and  others  of  their  faith,  in  ascribing  to  gold  and  silver, 
when  discharging  the  appropriate  functions  of  money,  the  attribute 
of  pricr,  which,  we  conceive,  leads  to  obscurity,  even  to  error. 

The  world  has  agreed  upon  gold  and  silver,  not  only  as  the 
common  medium  of  trade,  but  as  the  common  instrument  to  ex- 
press the  values  of  all  other  things  that  are  worth  money,  and  to 
purchase  them  ;  but  it  has  not  agreed  on  anything  to  express  the 
value  of  gold  and  silver,  when  discharging  the  functions  of  money  ; 
and  there  is  no  such  thing.  How,  then,  can  gold  and  silver,  in 
this  office,  be  valued  ?  How  can  they  be  worth  more  or  less,  than 
themselves,  weighed  in  the  scales  ?  We  know,  indeed,  that  gold 
and  silver  vessels,  or  any  works  of  art  composed  of  these  sub- 
stances, are  prized  by  gold  and  silver  coin.  And  why?  Be- 
cause there  are  two  principles  in  their  value:  one  their  weight, 
and  the  other  their  workmanship.  Leave  out  their  workmanship, 
and  gold  is  gold,  and  silver  is  silver,  of  equal  value,  if  equally 
pure,  according  to  their  weight,  whether  in  coin,  or  bullion,  or 
works  of  art.  It  would  be  absurd  to  suppose,  that  gold  and  silver, 
the  instruments  of  expressing  values,  should  express  their  own 
value,  each  for  each.  There  they  are,  no  n)atter  how  much  in  the 
world  ;  no  matter  how  little  ;  the  world  has  agreed  that  they  shall 
express  all  other  exchangeable  values  ;  but  never,  that  anything 
else  shall  express  their  value.  How,  then,  can  they  be  cheap  or 
dear,  cheaper  or  dearer,  while  acting  in  the  capacity  of  money? 

Mr.  Huskisson,  one  of  the  greatest  of  British  statesmen,  said,  in 
1816,  "  Gold,  in  this  country,  as  silver  in  Hamburg,  is  really  and 
exclusively  the  fixed  measure  of  the  rising  and  falling  value  of  all 
other  things,  in  reference  to  each  other.  The  article  itself,  which 
forms  this  standing  measure,  never  can  rise  and  fall  in  value,  with 
reference  to  this  measure ;  that  is,  with  reference  to  itself  A 
pound  weight  of  gold  can  never  be  worth  \\  pounds  of  gold.     The 


218    PRICE  NOT  AN  ATTRIBUTE  OF  MONEY  AS  SUCH. 

truth  of  this,  which  can  not,  I  conceive,  be  called  in  question, 
would  not  be  affected  by  any  imaginable  increase  or  diminution 
in  the  quantity  of  gold  in  the  country.  .  .  Gold  [in  England]  is 
the  fixed  measure  of  the  rising  and  falling  value  of  all  other  com- 
modities, in  reference  to  each  other."  Again  he  says  :  "  A  bank- 
note is  not  a  commodity  ;  it  is  only  an  engagement  for  the  payment 
of  a  certain  specific  quantity  of  money.''''  Lord  King  said  :  "  It 
may  be  assumed,  on  probable  grounds,  that  the  bullion  has  not 
become  dear,  but  that  the  paper  for  which  it  is  exchanged  has  been 
rendered  cheap,  because  every  commodity  is  cheap  or  dear,  in 
proportion  to  the  abundance  or  scarcity  of  the  supply." — "We  are 
in  error,"  said  Sir  Robert  Peel,  1847,  "  when  we  talk  about  the 
price  of  gold.  The  promissory  note  is  a  promise  to  pay  a  definite 
weight  of  gold,  and  nothing  else."  Even  M.  Say  comes  to  our 
aid  here  as  follows:  "In  treating  of  the  elevation  and  depression 
of  the  price  of  commodities,  although  value  has  been  expressed  in 
money,  no  notice  has  been  taken  of  the  value  of  money  itself; 
which,  to  say  the  truth,  plays  no  part  in  real,  or  even  in  relative, 
variations  of  the  price  of  other  commodities."  He  also  says  : 
"  The  price  of  an  article  is  the  quantity  of  money  it  may  be 
worth  ;  current  price,  the  quantity  it  may  be  sure  of  obtaining  at 
the  particular  place." 

'  "  AVhat  is  worth  in  anj'thing, 

But  so  much  money  as  t'will  bring  ?" — Hudibras. 

The  British  mind  seems  never  to  have  disembarrassed  itself 
from  the  effects  of  the  controversy  on  this  point,  during  the  legal- 
ized suspension  of  cash  payments  in  the  bank  of  England,  from 
1797  to  1822,  when  it  was  so  vital  to  the  empire  to  support  the 
credit  of  the  paper  of  that  bank.  Will  it  be  believed,  that  the 
British  house  of  commons,  in  1812,  on  motion  of  Mr.  Vansittart, 
resolved,  by  a  large  majority,  that  "bank-notes  were  not  depreci- 
ated, but  gold  enhanced  in  value?"  —  "Mr.  Chambers,"  says 
Professor  Twiss,  "  one  of  the  witnesses  examined  before  the  bul- 
lion committee,  whose  reputation  for  intelligence  and  information 
stood  very  high  in  the  commercial  world,  declared,  that  he  did  not 
conceive  gold  to  be  a  fairer  standard  for  bank  of  England  notes, 
than  indigo  or  broadcloth."  It  is  true,  that  the  bullion  com- 
mittee, of  which  Mr.  Huskisson,  cited  above,  was  one,  came  to  a 
different  and  the  true  conclusion.  But  the  majority  of  the  house, 
either  believed  in  their  doctrine,  or  thought  it  an  expedient  measure 


PRICE    NOT    AN    ATTRIBUTE    OF    MONEY    AS    SUCH.         219 

of  State  policy  to  keep  up  this  popular  delusion,  till  the  contest 
with  Napoleon  should  be  over.  The  notes  of  the  bank  were  then 
at  a  discount  of  <£13  9s.  6d.  per  .£100,  for  gold.  It  was  then 
sixteen  years  after  the  bank  suspended,  and  no  one  could  see  the 
end  of  it.  The  empire,  with  this  dubious  and  expensive  war  upon 
its  hands,  was  compelled  to  subsist,  so  far  as  its  currency  was 
concerned  —  a  vital  matter — on  the  credit  of  this  irredeemable 
paper.  It  was,  perhaps,  a  patriotic  virtue  in  the  house  of  com- 
mons to  decree  and  announce  a  stupendous  untruth.  It  was  an 
atrocious  fraud  in  legislation,  to  make  the  bank-notes  a  legal  tender; 
the  cheat  was  immense,  and  extended  to  a  quarter  of  a  century. 

No  one,  of  course,  will  imagine,  that  we  mean  to  call  in  ques- 
tion the  propriety  of  speaking  of  money  as  dear  or  cheap,  as  of 
high  or  low  price,  as  a  subject  of  trade.  It  is  only  when  employed 
as  the  instrument  of  trade,  that  we  maintain  it  can  have  no  price 
in  relation  to  the  commodities  for  which  it  is  exchanged.  In  this 
transaction,  price  can  not  belong  to  both  the  agent  and  the  sub- 
ject ;  but  only  to  the  latter.  It  is  the  very  function  of  the  agent  to 
prize  the  subject. 

M.  Say  is,  in  our  opinion,  right  in  his  advice,  that  money  should 
pass  by  its  weight.  But  he  does  not  seem  to  have  seen,  that,  in 
advocating  this  principle,- he  has  admitted,  that  money,  as  the  in- 
strument of  trade,  occupies  a  position  outside  of  valuation,  or  which 
is  inconsistent  with  it.  Neither  does  he  seem  to  have  recognised 
the  fact  that  his  advice  has  been  complied  with,  in  all  coins,  not  as 
coming  from  him,  but  before  his  time,  from  necessity.  All  denomi- 
nations of  coin,  are  rated  at  the  mint,  according  to  their  weight ; 
and  it  is  known,  to  all  those  who  trade  in  them,  precisely  what  their 
legal  weight  is,  and  what  fractions  of  them  are  composed  of  pure 
meial  and  alloy.  Every  coin,  therefore,  whatever  be  its  denomi- 
nation, always  passes,  in  a  common  currency,  for  a  specific  weight 
of  pure  metal,  though  not  named  to  the  parties  on  the  face  of  the 
coin,  which  is  the  principle  that  M.  Say  contends  for.  But  he 
seems  to  think  that  it  would  have  been  better,  if  there  had  never 
been  any  other  denomination  than  those  of  weight,  which  have 
gone  into  disuetude,  except  when  the  precious  metals  are  subjects 
of  trade,  as  in  the  practice  of  bankers  and  brokers,  who  use  the 
scales  for  considerable  and  often  for  small  amounts.  M.  Say 
moreover  says  :  "  If  a  house  be  valued  at  20,000  francs,  it  is  reck- 
oned to  be  equivalent  to  so  many  pieces  of  silver  coin,  of  the  weight 
of  5  grammes,  with  a  mixture  of  i^^th  alloy."     Again  :  "  The  de- 


220    PRICE  NOT  AN  ATTRIBUTE  OF  MONEY  AS  SUCH. 

nomination  of  coin  is  useful  only  inasmucli  as  it  designates  the 
quantity  of  pure  metal  contained  in  the  sum  specified." 

M.  Say  was  right,  in  the  principle,  that  weight  is  the  proper 
denomination  of  money;  and  in  advocating  it,  he  surrendered  his 
other  principle,  that  money,  as  such,  can  be  high  or  low,  dear  or 
cheap.  He  doubtless  asserted  this  other  principle,  on  the  assump- 
tion, that  there  is  no  difference  between  gold  and  silver  as  subjects 
and  instruments  of  trade  —  an  attainment  which  he  seems  never  to 
have  made,  and  the  importance  of  which  has  been  shown. 

Money  is  virtually  —  we  might,  perhaps,  say  absolutely — an 
inappreciable  thing.  It  is  unnecessary  to  know  the  worth  of  it, 
since  all  the  world  have  agreed  to  use  it  as  the  medium  of  trade. 
When  employed,  the  only  question  between  the  parties  is — how 
much?  what  quantity?  what  weight?  And  when  the  parties  have 
agreed,  that  is  the  price  —  of  what?  Of  the  thing  exchanged  for 
it — the  agreement  of  the  parties  being  the  measure  of  value,  and 
the  quantity  of  money  the  expression  of  it,  as  well  as  the  agent  to 
consummate  the  arrangement,  or  the  instrument  of  purchase.  But 
the  money  has  no  price.  There  is  not  a  thing  on  earth  that  can 
prize  it ;  much  less  can  it  prize  itself,  except  in  the  exchange  of 
its  own  varieties  ;  for  that  would  be  an  absurdity.  But  the  moment 
gold  and  silver,  or  paper  representing  them,  come  to  be  bought  and 
sold,  as  subjects  of  trade,  they  occupy  a  different  position,  and 
are  prized,  like  every  other  commodity,  one  kind  with  another. 
A  note  discounted  at  the  bank,  is  bought  as  a  subject  of  trade; 
while  the  discount  is  the  price,  the  instrument,  discharging  the 
functions  of  money.  The  principal  sum  received  by  the  drawer 
of  the  note,  is  also  a  subject  of  trade,  in  this  transaction.  But  he 
goes  away  and  buys  corn  with  it,  and  then  it  is  the  instrument — 
money.  He  bought  it  to  use  as  money  ;  but  it  did  not  come  into 
his  hands  as  money,  but  as  a  commodity  in  trade.  The  same  is 
the  case  with  all  notes  of  hand,  with  use.  They  are  sold,  and  the 
interest  is  the  price.  Bonds  and  mortgages,  with  use,  occupy  the 
same  position.  Bank-notes,  above  and  below  par,  are  bought  and 
sold,  and  the  broker's  profit  is  the  price.  So  the  profit  on  bills  of 
exchange  is  their  price.  The  principal  sums,  or  rates  of  valuation, 
in  all  these  cases,  are  negotiated  as  commodities  in  trade  ;  and  the 
premiums,  or  discounts,  or  the  interest  or  profits,  are  the  considera- 
tions asked  and  received,  discharging  the  functions  of  money.  It 
is  the  different  forms  and  different  values  of  money,  and  its  value 
in  use,  which  create  a  demand  for  it,  and  bring  it  into  market  as  a 


PRICE    NOT    AN    ATTRIBUTE    OF    MONEY    AS    SUCH.         221 

subject  of  trade.  If  depreciated  or  above-par  money  is  employed 
in  trade,  so  as  on  that  account  to  affect  the  prices  of  the  commodi- 
ties for  which  it  is  exciianged,  it  is  then  itself  a  commodity  in 
trade. 

Money,  even  as  a  subject  of  trade,  has  no  price  but  that  of  its 
use,  and  that  of  differences  of  value,  in  different  forms,  or  in  other 
accidents  of  its  existence.  The  first  is  always  reckoned  so  much 
per  centum,  as  2,  or  -3,  or  4,  or  G,  or  10  per  cent.  This  per-cent- 
age  is  the  price,  reckoned  on  the  standard  of  weight,  and  not  the 
sum  total,  as  when  it  performs  the  offices  of  the  instrument  of  trade. 
Then  the  whole  sum  is  the  price  of  the  thing  for  which  it  is  given 
in  exchange.  It  is  on  this  point  that  Professor  Twiss  is  right  in 
avowing  that  "  money  is  not  productive  as  an  instrument  of  ex- 
change," or  of  trade.     But  when  its  use  is  sold,  it  is  productive. 

Money,  however,  in  different  forms,  and  the  same  forms  in  dif- 
ferent places  or  circumstances,  has  different  prices,  on  the  common 
standard  of  weight.  Legislation  makes  one  of  these  differences, 
as,  for  example,  the  EngHsh  sovereign  is  declared  legal  lender  in 
the  United  States,  at  $4.84  ;  but  its  statute  valuation  in  England  is 
only  S4.44,  which  makes  them  subjects  of  trade  in  these  two  quar- 
ters, and  tlie  prices  are  based  on  the  standard  of  weight,  being  not 
the  principal  sums,  but  arising  out  of  these  accidental  differences. 
So  of  all  moneys,  metallic  or  other,  being  in  market  as  subjects, 
to  be  bought  and  sold  for  use  as  instruments  of  trade,  either  their 
use  on  time,  or  their  variations  from  a  common  standard,  and  not 
the  principal  sum,  determine  their  prices.  Whereas,  when  money 
is  employed  as  the  instrument  of  trade,  in  exchange  for  other  com- 
modities, the  entire  sum  given  is  the  price,  not  of  itself,  but  of  the 
commodity.  The  price  of  all  moneys  bought  for  use,  on  time, 
commonly  called  borrowing,  is  its  per-centage.  We  never  find 
the  price  of  money,  as  a  subject  of  trade,  to  be  the  principal  sum, 
in  any  case  whatever;  but  it  is  either  a  consideration  for  its  use 
on  time,  or  a  consideration  growing  out  of  some  one  or  other 
of  the  varying  accidents  of  its  existence ;  and  all  its  prices  are 
based  on  the  standard  of  the  scales,  directly  or  indirectly,  medi- 
ately or  immediately.  But  money,  as  the  instrument  of  trade, 
never  has  a  price,  its  functions  being  to  declare  the  prices  of  the 
things  on  which  it  acts,  and  to  move  them  forward  to  their  destina- 
tions—  this  declaration  and  this  moving  power  being  its  proper  and 
only  functions.  The  only  fundamental  measure  of  money  is  the 
scales  ;  though,  in  the  superstructure  of  a  monetary  system,  many 


222    PRICE  NOT  AN  ATTRIBUTE  OF  MONEY  AS  SUCH. 

Other  accidental  measures  are  employed,  for  convenience,  all  hav- 
ing reference  to  this,  and  b6ing  based  upon  it. 

To  show  that  money,  as  a  subject  of  trade,  has  no  price,  other 
than  as  above  defined,  observe,  that  a  man,  with  one  bar  of  gold 
or  silver  bullion,  does  not  propose  to  exchange  it  for  another  bar 
of  the  same  weight  and  purity.  There  is  no  motive.  Nor  does  a 
person  propose  to  exchange  coins  for  others  of  the  same  denomi- 
nation and  weight ;  nor  bank-notes  for  others  of  the  same  denom- 
inations and  of  the  same  bank  ;  nor  any  kind  of  money  for  another, 
where  there  is  no  foundation  or  reason  for  difference  in  value,  and 
of  consequent  advantage  to  one  of  the  parties,  which  advantage 
would  be  a  foundation  of  price,  or  a  motive  for  exchange.  There 
is  no  motive  to  exchange  an  equal  for  an  equal.  It  must  be  a  dif- 
ference of  some  kind,  to  constitute  the  foundation  of  price  in 
money.  In  purchasing  the  use  of  money  on  time,  the  principle 
of  price  is  doubtless  too  obvious  to  require  farther  illustration  ; 
and  enough  has  already  been  said  to  show  the  different  posi- 
tion and  proper  functions  of  money,  as  the  instrument  of  trade, 
and  that  price,  or  what  Mr.  Twiss  calls  productiveness,  does  not 
belong  to  it  in  that  case. 

Convenience  requires  a  uniform  rule,  either  that  cheapness  or 
dearness  should  be  applied  to  money  alone,  or  to  the  things  of 
which  it  is  the  medium  of  exchange.  Custom  has  applied  them 
to  the  latter,  and  ordained  money  to  express  all  their  values.  This 
office  of  money  is  a  law  made  and  obeyed  by  all  the  world,  and 
there  is  no  antagonist  law.  There  is  nothing  else  by  consent  or 
practice,  that  expresses  the  value  of  money  as  such.  Ricardo, 
Smith,  and  others,  by  violating  custom  and  the  ordinances  of  uni- 
versal consent  in  this  matter,  have,  we  think,  introduced  confusion 
and  darkness  where  order  and  light  are  needed,  and  plunged  into 
an  inextricable  labyrinth. 


MONEY    AS    THE    "TOOLS    OF    TRADE."  223 


CHAPTER   XV. 

MONEY    AS    THE    "TOOLS    OF    TRADE." 

An  Illustration  of  this  Truth. — The  Condit'on  of  a  Nat'on.  after  selling  its  "  Tools  of  Trade," 
the  Same  as  that  of  a  Mechatiic  who  does  ihe  same  Thins. — Montesquieu's  Doctrine  on 
this  Point. — The  Emperor  of  Rn.^sia  investing  in  French  Stocks  —  Money  but  an  incon- 
siderable Fraction  of  a  Nation's  Wealth. — To  answer  its  Purposes,  Money  should  be  to 
a  Nation  as  a  fixed  Capital — It  is  "  Tools." — Haifa  Set  of  "  Tools"  not  as  good  a-s  a  per- 
fect Set  — Money  the  necessary  Means  of  a  Nation's  Wealth  — The  Amount  requited  by 
a  Nation,  depends  on  its  Re.«ources  and  Capabilities. — The  Charge  of  a  Miser  Spirit  on 
Proiectionists  consiilered. — Bad  Economy  to  hoard  up  Money — The  Commercial  Revul- 
sions in  the  United  States  alwa_\e  owing  to  the  Want  of  Money  as  '■  Tools  of  Trade.'" — 
A  Protective  System  necessary  to  lieep  on  hand  "  Tools"  enough. — There  has  nevtr  yet 
been  Money  enough  in  the  United  States  for  the  Business  of  the  People — Monej-  makes 
the  Mare  go. — To  have  Money  enouf=h.  as  '■  Tools  of  Trade,"  is  Evidence  of  Private 
and  Public  Economy. — Ignorance  the  Parent  of  Free  Trade  in  the  United  Slates. — The 
Precii'us  Metals  are  to  Society  equivalent  to  a  Law  of  Nature — Mr.  Jaiobs  on  tleUses 
of  the  Precious  Metals. — The  Quantity  of  the  Piecious  Metals  required  fir  the  Trade  of 
the  United  States. — The  Commercial  Troubles  of  this  Country  owing  to  unfortunate  and 
fitful  Changes  in  the  Policy  of  the  Government. 

Can  a  farmer  till  his  grounds  without  a  plough?  Can  a  tailor 
make  up  his  garments,  without  his  shears  and  needle  ?  Can  a 
waterman  put  forward  his  boat,  without  a  paddle ;  or  a  ship  navi- 
gate the  seas,  without  sails  or  steam  ?  Can  any  work,  of  any  sort, 
be  done,  without  the  appropriate  instruments?  Money  is  as  much 
the  instrument  of  trade,  as  the  plough  is  of  agriculture,  the  tailor's 
needle  of  making  garments,  the  oar  of  speeding  the  boat,  or  the  sails 
or  steam  of  navigation.  But  Smith,  Say,  Ricardo,  M'Culloch, 
Tvviss,  and  their  colaborers,  tell  us,  in  effect,  that  the  plough  is 
only  a  commodity,  and  the  farmer  may  as  well  sell  that  as  his  corn ; 
that  the  needle  is  only  a  commodity,  and  the  tailor  may  give  his 
whole  stock  of  tools  for  his  dinner,  without  inconvenience  ;  that  the 
waterman  may  barter  his  paddle  for  a  fish,  or  the  fisherman  give 
his  hook  and  line  for  bait,  and  both  do  as  well  without  their  tools 
as  with  ;  that  the  weaver  will  suffer  nothing  in  selling  his  loom  and 
shuttle  ;  that  the  woodman  may  exchange  his  axe  for  a  shirt,  with- 
out harm  to  his  occupation  ;  that  the  smith  may  part  with  his  ham- 
mer for  a  saw,  in  an  exchange  with  the  carpenter,  and  both  go  on 
with  their  work  ;  that  the  shoemaker  may  exchange  his  kit  of  tools 
for  a  coat,  and  still  work  on  with  profit;  in  short,  that  all  these  things 
are  mere  commodities,  and  provided  the  parties  have  made  a  good 


224  MONEY    AS    THE    "TOOLS    OF    TRADE." 

speculation,  as  a  trade,  they  have  done  well ;  or  if  they  have  merely 
got  an  equivalent,  in  market  values,  they  can  not  be  losers.  Such 
is  the  doctrine  of  Free  Trade. 

But,  money  is  a  nation's  '■'■Jc'u  of  tools  ;''''  nothing  more;  nothing 
less.  And  yet  these  gentlemen  say,  it  is  no  matter ;  it  is  just  as 
well ;  the  nation  will  not  suffer  the  least  inconvenience,  if  it  parts 
with  its  "  kit  of  tools,''''  and  obtains,  by  the  exchange,  equivalent  values. 
They  say,  in  effect,  that  a  shoemaker  can  still  go  on  making  shoes, 
and  do  as  well  as  ever,  if,  by  exchanging  his  kit,  he  gets  other 
commodities  of  equivalent  value.  It  is  impossible  to  escape  from 
this  issue,  on  the  premises  of  these  gendemen.  No  one  can  deny 
that  this  is  precisely  the  case  which  they  have  made. 

If  it  be  said  that  a  man  ought  to  part  with  his  "  tools  of  trade," 
rather  than  not  pay  his  debts,  it  is  raising  a  new  question,  which  is 
one  of  morality.  We  go  farther  back,  and  anticipate  this  question, 
in  the  position,  that  a  man  should  be  more  prudent  than  to  allow 
his  "  tools  of  trade"  to  become  liable  for  his  debts.  This  is  pre- 
cisely the  position  we  occupy  on  public  economy.  We  hold,  that 
money,  enough  for  the  demands  of  trade,  is  the  " /oo/a' of  trade"  to 
a  nation,  and  that  its  system  of  economy  should  be  so  adjusted  and 
managed,  as  not  to  put  its  "  tools"  in  the  condition  of  liability  for 
its  debts.  A  nation  can  not  hold  on  to  its  "tools,"  after  they  have 
become  thus  liable  ;  but  they  must  go,  till  there  is  no  more  to  go  ; 
and  then  the  efflux  is  barred  by  exhaustion.  The  doctrine  of  our 
opponents  is,  that  a  nation  is  none  the  worse  off,  is  put  to  no  incon- 
venience, by  the  loss  of  its  "tools  of  trade."  Is  not  this  the  case 
which  they  have  made?    If  it  be  not,  we  know  not  what  is. 

Montesquieu  says:  "A  country  which  always  exports  less  than 
it  receives,  maintains  an  equilibrium  by  impoverishing  itself.  It 
will  continue  to  receive  less,  until  it  will  have  reached  a  state  of 
extreme  poverty,  when  it  will  cease  to  receive  anything." 

Exactly  in  point  comes  the  news,  while  we  are  writing  this 
page,  of  the  transaction  of  the  emperor  of  Russia  with  the  bank  of 
France,  in  the  purchase  of  50,000,000  francs  of  its  stocks,  or 
nearly  $10,000,000.  It  is  understood  —  we  believe  it  was  openly 
avowed  on  the  bourse  at  Paris  —  that  the  object  of  the  French  gov- 
ernment, in  lending  its  intermediate  offices,  to  obtain  these  stocks 
for  the  emperor,  at  the  middle  price,  was  to  bring  fifty  millions  of 
specie  into  France,  which  was  pressingly  required  —  France  hav- 
ing parted  with  too  much  of  her  "  tools  of  trade,"  and  being  threat- 
ened with  commercial  bankruptcy  and  financial  ruin.     It  was  to 


MONEY    AS    THE    "TOOLS    OF    TRADE."  225 

bring  back  these  "  tools  ;"  and  the  necessity  of  France,  in  this 
case,  subjected  her  to  some  peril,  as  it  will  at  any  time  be  in  the 
power  of  the  emperor  of  Russia,  by  a  coi/p-dr-mnin  operation,  sud- 
denly to  throw  these  stocks  into  market,  and  create  a  panic,  to  the 
great  injury  of  France.  But  "necessity  knows  no  law."  PVance 
wanted  more  "tools  of  trade,"  and  must  have  them.  If  these 
stocks  had  heen  sold  in  Paris,  to  Frenchmen,  the  price  would  not 
have  come  from  abroad,  to  meet  the  exigency  ;  but,  in  selling  them 
to  the  emperor  of  Russia,  it  brought  50,000,000  of  francs  directly 
into  France,  as  so  much  addition  to  its  "numeraire,"  or  cash.  But, 
according  to  Adam  Smith  and  company,  it  was  no  misfortune  to 
France  to  have  wanted  this  amount  of  specie,  nor  any  benefit  to 
get  it.* 

Because  money  will  supply  wants  and  gratify  desires,  by  pro- 
curing the  means,  it  is  thence  too  naturally  conchaded,  that  weakh 
consists  in  money  ;  it  is  true,  that  a  given  amount  of  money,  in  any 
one's  possession,  makes  him  a  rich  or  wealthy  man,  according  to 
the  standard  of  wealth  assumed.  Nevertheless,  money,  though  it 
may  be  the  fortune  of  an  individual,  because  it  will  supply  his  wants 
and  gratify  his  desires,  is  not,  in  itself,  any  considerable  part  of 
the  wealth  of  a  community  or  of  a  state.  If  the  annual  product 
of  the  industry  and  labor  of  the  people  of  the  United  States,  be 
$2,000,000,000,  as  is  supposed,  that  product  is  an  exponent  of 
their  wealth  ;  and  it  is  supposed,  that  not  a  penny  of  it  consists  in 
money.  We  do  not  produce  money,  to  any  extent  worth  naming. 
If  it  requires  fifty  millions  of  money  to  move  such  portions  of  diis 
product  to  their  various  destinations,  as  are  not  consumed  on  the 
premises  where  they  are  created,  say  a  moiety  of  them,  then  the 
amount  of  money  employed  in  moving  these  products  to  their  des- 
tination, is  as  one  fortieth  of  their  amount.  And  if  this  product 
be  to  its  sources  and  means,  or  to  the  capital  of  the  country,  as  6  to 
100,  the  rate  of  interest,  then  the  money  of  the  country  is  only 
as  -jLth  of  Tooths  of  the  national  capital  —  a  fraction  of  the  general 
wealth  hardly  worth  naming. 

The  position  and  functions  of  money,  in  this  movement,  are  to 
the  people,  as  the  "  tools  of  trade"  to  a  man  in  any  pursuit.  As  a 
man  can  not  do  his  business  without  his  tools,  so  neither  can  a  peo- 
ple trade  without  money.  Money,  with  a  nation,  is  permanent,  and 
•  Since  writing  the  above,  the  French  revolution  of  February,  1848,  has  occur- 
red; but  that  inalves  no  difference  with  the  areumenf.  France  was  in  want  of 
specie  at  that  time,  under  Louis  Philippe,  and  this  transaction  was  negotiated  to 
obtain  it. 

15 


226  MONEY  AS  THE  "TOOLS  OF  TRADE." 

ought  to  be  fixed  capital,  as  the  tools  of  a  mechanic  are.  It  occu- 
pies the  same  position  in  trade.  If  a  mechanic  has  but  half  a  set 
of  tools,  he  can  not  work,  except  under  great  disadvantage.  It  is 
the  same  with  a  people,  in  regard  to  money  :  they  want  a  complete 
set  of  tools,  and  will  work  very  badly  with  half  a  set.  And  yet 
Free  Trade  says,  it  is  no  matter,  whether  you  sell  your  tools,  or 
your  other  commodities. 

That  money  is  a  fraction  of  the  public  wealth,  a=i  permanent  cap- 
ital, occupying  the  position,  and  discharging  the  functions  of  tools, 
in  creating  and  promoting  general  wealth,  can  not  be  denied  ;  but 
it  is  a  small  fraction  ;  in  the  strict  sense,  it  can  hardly  be  called 
wealth  ;  but  is  more  properly  the  means  of  it.  But,  as  it  is  the 
most  essential  element  of  wealth,  in  public  economy,  as  a  means, 
there  is  no  harm  in  calling  it  by  that  name,  so  far  as  it  goes,  if  its 
proper  position  and  functions  are  understood.  It  is  certain,  there 
can  be  no  wealth,  in  the  sense  of  prosperity,  without  it.  If  fifty 
millions  of  active  money  capital  are  necessary  to  move  all  the  sur- 
plus products  of  every  point  of  the  United  States,  to  their  destina- 
tion, anything  less  than  that  would  be  a  check  to  the  movement ; 
half  of  it  would  be  a  very  serious  ca'amity,  and  occasion  universal 
distress.  And  yet  Free  Trade  says,  it  is  no  matter  :  half  is  as  good 
as  the  whole.  Adam  Smith,  as  shown  in  another  place,  undertook 
to  prove,  that  the  American  colonies  were  very  well  off,  when  they 
had  no  money  at  all. 

Money  itself  is  no  farther  wealth  than  as  the  means  of  producing 
it,  and  for  the  amount  of  the  precious  metals  which  it  comprehends, 
they  being  in  demand  for  other  uses;  and  the  money  of  a  country, 
and  of  the  world,  as  shown  above,  is  but  a  small  fraction  of  its 
wealth.  It  may  happen  that  all  of  an  individual's  wealth  is  vested 
in  money;  but  that  of  a  nation  can  never  be  ;  nor  more  than  a 
small  fraction. 

The  amount  of  money  which  a  nation  requires,  to  effectuate  the 
greatest  amount  of  production  in  exchangeable  values,  and  to  cir- 
culate them  so  as  to  produce  the  greatest  income,  in  other  words, 
to  move  all  surpluses  to  the  best  market,  is  a  question  of  considera- 
ble importance.  The  European  economists  seem  to  agree,  so  far 
as  we  have  observed,  that  a  nation  requires  only  money  enough  to 
circulate  its  exchangeable  values  which  require  movetnent  in  trade, 
to  and  fro,  outward  and  inward.  This  doctrine  is  doubtless  cor- 
rect; but  their  idea  of  the  application  of  it,  would  not  exactly  suit 
us.     They  appear  to  assume  a  we  plus  ultra  of  demand,  an  ascer- 


MONEY    AS    THE    "TOOLS    OF    TRADE."  227 

tainable  limit,  from  an  existing  state  of  tilings  ;  that  is,  that  this 
state  of  things  has  nearly  or  quite  exhausted  its  requirements  or 
uses  of  money.  This  does  not  apply  to  the  United  vStates.  We 
have  never  yet  come  in  sight  of  the  end  to  which  an  increase  of 
money  might  not  be  profitably  applied  for  the  production  of  wealth', 
so  inexhaustible  are  our  resources  ;  nor  has  there  ever  been  a  time 
when  it  could  be  said  there  was  too  much  money,  or  even  enough, 
in.  the  country,  so  as  to  want  use.  The  extravagant  speculations 
of  IS'^G— '7,  are  not  in  point;  because  they  were  not  based  on 
money  ;  but  were  mere  bubbles,  doomed  to  burst,  for  want  of 
money  as  a  foundation. 

A  system  of  public  economy,  therefore,  adapted  to  the  state  of 
things  found  in  Europe,  limiting  the  uses  of  money,  and  thus 
limiting  the  amount  required,  maybe  very  ill  adapted  to  the  United 
States,  where  the  uses  for  money  are  comparatively  without  limit. 
The  "  kit  of  tools*'  for  the  trade  and  commerce  of  Europe,  might 
be  very  complete,  under  a  system,  which  would  leave  ours  very 
incomplete.  It  is  for  us  to  judge  what  we  want,  and  for  them  to 
judge  what  they  want.  It  is  evident  that  European  economists 
had  no  idea  of  the  state  of  things  here,  in  this  particular.  When 
was  there  a  time,  that  this  nation,  or  any  part  of  it,  or  any  party  or 
person  in  it,  could  not  have  done  more  in  the  production  of  wealth, 
if  they  had  had  more  money  to  do  it  with  ?  We  want,  then,  a  sys- 
tem of  public  economy,  which  shall  not  only  tend  to  keep  in  the 
country  what  is  commonly  reckoned  enough  of  money,  to  carry  on 
its  trade  and  commerce  ;  but  we  want  a  system  that  shall  tend  to 
increase  that  amount,  as  far  as  may  be,  in  a  degree,  commensurate 
with  the  development  of  the  means  for  its  profitable  use.  As  yet, 
it  has  never  been  so. 

It  is  unfair,  and  shows  a  want  of  candor,  when  Smith,  Say,  Ri- 
cardo,  M'Culloch,  and  others  of  that  school,  while  en<rao-ed  in 
their  argument  on  the  balance  of  trade,  treat  their  opponents  as 
misers,  wishing  to  hoard  up  money ;  or  to  represent  them  as  in- 
sisting on  taking  nothing  but  specie  for  what  they  sell.  It  is  easy 
to  set  up  a  man  of  straw  in  this  way,  and  knock  him  to  the  winds, 
appearing  to  come  off  victorious.  But  this  is  not  our  position. 
We  only  insist,  that  a  nation  must  so  regulate  its  trade  with  foreign 
parts,  that,  talcing  it  all  together,  more  money  should  not  habitually 
go  from  the  country,  than  comes  back;  that,  if  more  specie  is  an- 
nually exported  than  is  imported,  the  nation  will  soon  be  in  com- 
mercial troubles,  for  want  of  money  to  trade  with;  that,  in  the 


228  MONEY    AS    THE    "  TOOLS    OF    TRADE." 

United  States  —  we  do  not  speak  for  other  nations  —  a  protective 
system  is  indispensable  to  prevent  such  a  public  disaster ;  that, 
under  such  a  system,  we  do  not  trade  less  abroad,  as  our  op- 
ponents aver,  but  more;  that,  in  the  long  run,  both  our  exports 
and  imports  of  other  commodities  than  money,  will  be  greater ;  and 
that  the  only  way  for  us  to  secure  this  growth  and  prosperity  of 
commerce,  is  by  a  protective  system.  Such  being  the  operation 
of  this  system,  when  properly  adjusted,  as  proved  in  other  parts  of 
this  work  —  it  being  supposed  that  we  draw  in  as  much  money  as 
we  send  out,  and  rather  more  than  less  —  money,  as  the  instrument 
of  trade,  is  never  wanting,  can  not  be  wanting.  Not  that  we  pro- 
pose to  have  any  lie  idle.  That  would  be  waste.  There  would 
be  litUe  danger  of  that,  so  long  as  the  untouched  resources  of 
wealth  in  this  country,  are  so  many  and  so  great ;  and  so  long  as 
a  moiety  of  its  capabilities,  more  or  less,  are  forced  to  lie  in  repose 
for  want  of  means. 

It  is  decidedly  bad  economy,  in  a  man  or  a  nation  to  hoard  up 
money.     If  a  thriving  man  gets  more  money  than  he  wants  to  use 
in   his  business  or  trade,  he  will  invest  it  somewhere,  that  it  may 
do  business  and  trade  without  his  agency  or  care,  and  afford  him 
an  income.     But  as  a  prudent  man,  he  will  take  care  not  to  have 
less  money  at  his  command,  than   his   business  or  trade  requires. 
In  case  he  should  have  less,  his  affairs  will  suffer,  and  his  estate 
will  be  injured.     He  may  even  be  so  embarrassed  as  to  be  forced 
into  bankruptcy,  broken  up,  and  perhaps  ruined  —  all  for  want  of 
a  sound  system  of  economy,  for  buying  too  much,  and  running 
in  debt  without  means  to  pay.     So  a  nation,  for  precisely  the  same 
reasons,  may  fall  into  the  same  situation,  in  its  foreign  commercial 
relations,  as  has  several  times  happened  to  the  United  States  —  all 
for  want  of  a  sound  system  of  public  economy.     And  such  a  sys- 
tem, it  will  be  observed,  as  its  name  imports,  is  directly  opposed  to 
a  system  of  Free  Trade.     It  will  also  be  observed,  that,  whenever 
commercial  revulsions  have  come  over  this  country,  it  was  in  con- 
sequence of  the  prevalence  of  Free-Trade  principles  and  practice. 
There  is  no  difference  between  the  loose  and  profligate  habits  of 
private  individuals,  which  involve    them    in   pecuniary  troubles, 
and  Free-Trade,  which  always  brings   like  consequences  to  this 
country. 

Although  it  is  not  as  bad  for  a  man  or  a  nation,  to  have  money 
hoarded  up  and  lying  idle,  as  to  have  too  little,  and  though  it  can 
not  be  said  to  be  positively  calamitous,  nevertheless,  it  is*bad  econ- 


MO-VEY    AS    THE    *'  TOOLS    OF    TRADE."  229 

omy  —  it  is  waste.  And  as  it  is  important  for  a  man  to  have  money 
enough  for  his  own  business,  so  it  is  equally  important  for  a  nation  ; 
and  the  same  means,  in  both  cases,  that  is,  private  economy  in  one, 
and  public  economy  in  the  other,  must  be  employed  for  the  attain- 
ment of  this  end.  In  the  one  case,  the  rules  are  private  ;  in  the 
other,  public ;  but  in  both,  they  are  equally  opposed  to  Free 
Trade.  The  system  of  economy  in  each  case  consists  in  a  tariff 
of  duties,  the  great  aim  of  which  is,  not  to  buy  too  much,  to  live 
within  means,  and  to  have  plenty  of  means  ;  that  is,  plenty  of 
*'  tools  of  trade." 

Nor  is  there  any  danger  that  money  being  plenty,  will  lie  idle, 
except  in  a  miser's  chest,  or  a  monarch's  vault.  And  misers  cer- 
tainly are  diminishing  in  numbers  as  commerce  enlarges  its  sphere, 
and  becomes  more  active  and  more  productive.  Men  usually,  es- 
pecially the  Anglo-Saxon  race,  and  more  especially  the  American 
branch  of  that  race,  are  too  sensible  of  the  value  of  money,  as  a 
productive  power,  not  to  put  it  to  use  as  it  accumulates.  There 
never  yet  has  been  a  time,  in  the  history  of  this  country,  when 
there  was  an  excess  of  money  in  it,  above  the  demands  for  its  use, 
or  beyond  the  scope  of  the  subjects  of  a  profitable  investment; 
especially,  and  more  than  all,  profitable  to  labor;  and  the  greatest 
commercial  evil  the  country  has  ever  suffered,  has  been  the  want 
of  money.  One  single  fact,  viz.,  the  more  than  double  value  of 
money  in  the  United  States,  as  compared  with  its  average  value  in 
Europe  and  other  foreign  parts,  is  conclusive  evidence  on  this 
point.  The  incalculably  diversified  and  yet  undeveloped  resources 
of  this  country,  and  its  unassayed  improvements  of  which  it  is  so 
imn)ensely  susceptible,  present  a  field  for  the  employment  of  money, 
that  is  vast  and  boundless — a  field  which  has  long  invoked,  and 
still  invokes,  without  response,  an  application  of  capital,  in  an 
amount  which  ages  of  the  greatest  prosperity  will  not  furnish.  As 
a  question  of  public  economy,  therefore,  and  one  of  the  greatest 
moment,  it  seems  to  be  imperatively  demanded,  that  our  system  of 
foreign  commercial  policy  should  be  so  arranged  and  adjusted,  as 
to  draw  moneyed  capital  to  the  country,  and  retain  it  here  for  the 
execution  of  these  grand  and  momentous  objects ;  above  all,  that 
this  policy  should  not  be  left  so  loose  and  free  as  to  oblige  us  to 
lose  money  in  our  foreign  trade,  as  we  have  done  heretofore,  and 
thus  not  only  disappoint  and  put  far  off  these  great  and  stupendous 
home  enterprises,  but  cripple  and  embarrass  the  comparatively 
small   endeavors    already    attempted,    which    are    with    difficulty 


230  MONEY   AS    THE    "  TOOLS    OF    TRADE." 

sustained,  and  some  of  which,  indeed,  are  in  danger  of  overthrow 
or  suspension,  for  want  of  means  to  carry  them  on.  Nothing  but 
the  protective  policy  can  supply  us  with  the  money  capital  which 
the  country  needs;  and  witliout  it,  as  has  uniformly  been  the  resuh 
of  all  our  Free-Trade  experiments,  we  shall  be  impoverished  and 
broken  down. 

The  old  adage,  "  money  makes  the  mare  go,"  though  trite,  and 
apparently  below  the  dignity  of  tiferary  composition,  nevertheless 
contains  an  important  practical  principle.     But  the  great  secret  is, 
how  to  get  money,  how  to  keep  enough  on  hand,  or  at  command, 
for  necessary  uses,  and  how  to  pat  it  to  the  best  use.     This  practi- 
cal  part   is  jtistly   called    economy,  ia   both  private   and   public 
affairs.     It  is  straage  that  theorizing,  as  in  the  case  of  the  advo- 
cates of  Free  Trade,  should  lead  men  so  far  aistray  as  to  allow 
them  to  maiiTtain  that  tlie  products  of  labor,  other  than  money,  can 
be  made  active  and  productive  in  tKade,  without  money;  and  that 
it  is  of  no  injurious  consequence  for  a  comn>ercial  nation  to  part 
with  all  its  cash,  when  Free  Trade  draws  it  away.      They  do  not 
consider  that  money  is  the  moving  pov/CF  ;  but  seetft  to  take  pleas- 
ure in  behoving  a  bard  thing,  holding  it  for  true,  not  because  the 
truth  is  apparent,  but  occult- — taking  pride  in  a  doctrine  because  a 
miracle  only  could  verify  h.     Their  own  importance  is  magnified 
(m\y  by  their  extrava;ga»ce,  a-nd  by  the  extent  to- which  it  is  carried- 
Still,  every  sober  man  UMSt  see  that  oioney  is  power — pov/er  with 
a  man  and   i>ovver  with  a  nation — and  that  every  man  and  every 
nation,  without  money,  and  being  unable  to  command  it,  is  power- 
less.     This  truth  is  directly  opposed  to  a  fundamental  proposition 
of  the  Free-Trade  doctors,  Smiih  and  others,  that  money  occupies- 
the  same  position  in  trade  with  that  of  the  commodities  for  which 
it  is  exchanged  —  is  itself  no  raore  than   a  commodity  in  trade — 
and  that,  therefore,  it  is  no  n>atfer  in  trade,  which  goes  and  which 
comes,  that  or  any  other  commodity.     When  a  doctrine  like  this, 
is  permitted  to  enter  practically  into  a  system  of  private-  or  public 
economy,  as  an  element,  a  leaven,  pervading  the  whole,  it  is  surely 
no  wonder  if  the  affairs  of  such  a  system,  private  or  public,  come 
to  a  very  bad  resuh.     Nothing  but  extraordinary  good  luck  could 
prevent  it,  and  that  onJy  for  a  lucky  seasoa.     The  doctrine,  "j;er 
se,"  is  ruinous. 

The  pecuHar  and  exclusive  position  which  gold  and  silver,  as 
money,  occupy  in  the  worid  —  a  very  important  and  potent  one  — 
is  that  they  are  universally  recognised  as  a  common  currency  in 


MONEY    AS    THE    "TOOLS    OF    TRADE."  231 

trade  or  commercial  exchanges,  and  are  therefore  indispensable  as 
far  as  those  exchanges  may  require.  No  other  commodity  of  the 
world  occupies  this  position,  or  discharges  these  functions  ;  and 
consequently,  whenever  money  is  wanting,  in  a  greater  or  less 
degree,  trade  must  be  embarrassed.  The  doctrine  of  the  Free- 
Trade  theorists,  therefore,  is  utterly  false  —  false  in  principle,  and 
ruinous  in  its  application.  Here  is  the  origin  of  the  difficulty 
which  has  led  to  so  many  calamitous  results  in  the  United  States. 
The  superficial  thifikers  among  us,  statesmen  and  others,  who  have 
adopted  and  advocated  this  doctrine,  have  never  gone  down  to  the 
bottom,  nor  back  to  its  origin  ;  but  they  have  received  the  dogma 
ex  aslJiedra,  and  propagated  it,  without  understanding  it.  There 
are  certain  clap-trap  bubbles,  floating  on  the  surface,  which  reflect 
beautiful  colors,  and  seem  very  captivating ;  and  these  are  the  only 
objects  which  the  common  teachers  of  Free  Trade  see,  and  to 
which  they  direct  the  attention  of  the  public  ;  but  they  never  dive 
down,  nor  take  the  trouble  of  angJing,  to  fish  up  that  which  swims 
in  the  deep  sea.  It  is  not  too  much  to  aver,  that  they  neither  know 
what  they  say,  nor  whereof  they  affirm;  and  that  their  triumph  — 
«o  far  as  they  have  had  any  —  is  the  triumph  of  ignorance.  They 
have  yet  to  learn,  scientifically,  the  first  principles  of  economy; 
for  it  is  nothing  more  nor  less  tlian  a  question  of  economy.  If 
they  had  understood  the  fundamental  doctrine  of  their  masters, 
why  did  they  not  begin  there  ?  They  have  never  mentioned  it, 
and  probably  never  thought  of  it.  It  is  the  doctrine  that  money 
and  a  piece  of  cloth  are  the  same  thing  ;  that  they  occupy  the  same 
position,  and  that  there  is  no  difference  between  them,  in  their 
influence  on  the  operation  of  commercial  exchanges;  and  that  it 
is  of  no  consequence,  whether  we  have  one  and  none  of  the  other, 
or  much  of  one  and  little  of  the  other.  Had  our  own  Free-Trade 
statesmen,  and  other  of  our  teachers  of  this  school,  begun  here, 
and  thought  upon  it  as  much  as  the  importance  of  the  subject 
demands,  it  is  possible  they  might  have  been  startled.  But  they 
have  adopted  a  faith  without  scrutiny,  and  attempted  to  propagate 
it  without  knowing  what  it  is ;  and  we  can  hardly  expect  the  com- 
pliment of  an  acknowledgment  from  them,  if  their  eyes  should 
chance  to  fail  upon  these  pages,  that  we  have  told  them  what  they 
never  knew  before,  though,  peradventure,  it  might  be  true.  We 
will,  however,  venture  to  say,  that  they  will  agree  with  us  so  far, 
that  money  is  the  great  power  o^  the  world,  and  that  the  party 
which  has  none  of  it  is  weak.     They  will,  moreover,  admit  that 


232  MONEY    AS    THE    "TOOLS    OF    TRADE." 

there  is  such  a  practical  virtue  as  economy,  in  contriving  to  have 
money  for  necessary  uses.  We  do  not  wish  thera  to  admit  any 
more  ;  for  in  this  admission,  they  have  abandoned  both  the  ground 
and  the  principle  of  Free  Trade.  A  system  of  public  economy, 
contrived  to  retain  in  the  United  States  money  enough  for  its  neces- 
sary purposes,  would  be  a  protective  system.  And  no  one,  surely, 
will  pretend  that  our  trade  can  go  on  well,  when  there  is  not 
money  enough  in  the  country  to  keep  it  a  going. 

We  do  not  want  a  better  rule  of  public  economy  on  this  point, 
than  M.  Say  himself  has  given  against  himself,  that  is,  against  his 
leading  doctrine,  in  the  following  words:  "  The  use  of  gold  and 
silver  in  the  peculiar  character  of  money  is  proportionate  to  the 
quantity  of  moveable  and  immoveable  objects  of  property  that 
there  may  be  to  be  circulated  ;"  that  is,  transferred  in  sale,  as 
*'  immoveable  objects"  can  not  be  "  circulated."  In  this  proposition 
is  recognised,  first,  money  as  the  instrument  of  trade,  in  its  "  pe- 
culiar character,"  M.  Say's  j>eci/li(rr  mode  of  expression  ;  and 
next,  that  the  "  proportion"  required,  in  any  nation,  must  be  suf- 
ficient to  accomplish  the  exchanges,  without  embarrassment  for 
want  of  it.  This  is  precisely  the  doctrine  we  hold  to.  M.  Say 
also  admits  that  "money  is  the  vehicle  of  value.  Its  only  use  is 
to  convey  into  your  hands  the  value  of  the  produce,  which  the 
purchaser  of  your  goods  has  sold  in  order  to  purchase  them  ;  and 
to  convey,  in  return,  into  his  hands,  the  value  of  the  produce, 
which  you  have  already  sold  to  others."  Again :  "  The  com- 
modity employed  as  the  material  of  money,  is  the  agent  of  ex- 
chanti^e."  Could  anything  be  more  explicit,  more  clear,  or  more 
to  the  point  of  our  argument,  that  money  is  the  "  tools"  of  trade  ? 

It  is  not  less  remarkable  that  we  find  even  Professor  Twiss 
just  where  he  should  be  on  this  point :  "  The  money  of  a  country," 
he  says,  "  will  be  that  part  of  its  capital  which  is  exclusively  em- 
ployed in  facilitating  the  exchange  of  other  portions  of  its  capital, 
just  as  the  loom  of  the  weaver,  or  the  saw  of  the  carpenter,  are 
portions  of  the  capital  of  a  nation,  employed  in  facilitating  tne 
production  of  clothes  and  dwellings;"  and  yet  Professor  Twiss 
maintains  that  it  is  no  harm  to  sell  these  tools. 

M.  De  Boisguillebert,  a  French  economist  under  Louis  XIV., 
proscribed  by  that  prince  for  his  opinions,  said  :  "  Wealth  consists 
in  the  continual  exchange  of  the  surplus  which  one  individual 
possesses,  for  the  surplus  which  another  possesses  ;  and  the  moment 
the  means  [money]  of  effecting  this  exchange  are  wanting,  a  conn- 


MONEY    AS    THE    "TOOLS    OF    TRADE."  233 

try  becomes  distressed  in  the  midst  of  abundance."  And  Profes- 
sor Twiss  says  of  this  very  writer,  that  "De  Boisguillebert  had  a 
clear  appreciation  of  the  distinction  in  the  separate  employment  of 
silver,  as  money,  and  as  a  commodity,  and  that,  when  it  was  em- 
ployed as  money,  it  was  not  employed  productively,  and  the  reverse 
when  employed  as  a  commodity." 

Again  says  Mr.  Twiss:  "  The  money  of  an  individual  is  part 
of  his  circulating  capital,  and  he  can  only  derive  a  revenue  from  it 
by  parting  with  it ;  but  the  money  of  a  society  has  more  the  char- 
acter of  a  fixed  capital,  as  a  greater  revenue  accrues  to  a  society 
from  its  use  as  an  instrument  for  facilitating  exchanges  at  home, 
than  from  exchanging  it  as  an  article  of  commerce  with  foreign 
countries.  For  instance,  the  first  division  of  articles  in  which 
capital  is  fixed,  according  to  Adam  Smith,  consists  of  'all  useful 
machines  and  instruments  of  trade,  which  facilitate  and  abridge 
labor.'  Now  money  is  most  useful  lo  a  nation  as  an  instrument 
for  facilitating  exchanges,  and  abridging  the  tedious  operations  of 
barter  ;  and  as,  by  such  exchanges,  the  production  of  national 
revenue  is  indirectly  stimulated,  and  the  result  is  an  augmentation 
of  produce,  it  seems,  in  its  character  of  money,  to  be  rather  a  por- 
tion of  the  fixed  capital  of  a  country  ;  more  particularly  as  the 
waste  of  it  requires  to  be  made  good  from  the  circulating  capital." 

It  is  admitted,  that  money  is  not  wanted  for  any  other  purpose 
but  trade,  and  that  it  would  be  a  waste  to  have  more  than  this  ob- 
ject requires;  but  this  is  a  very  important  object.  It  is  vital  to  a 
system  of  public  economy,  and  depends  on  measures  of  public  pol- 
icy. As  every  private  person,  engaged  in  trade,  is  obliged  to  take 
care  that  he  has  money  enough  in  hand  or  at  command,  for  his  pur- 
poses, so  is  it  equally  necessary  that  a  nation  should  use  this  care. 
Neither  can  afford  Free  Trade.  The  farmer  must  keep  up  his 
fences;  and  every  person  must  defend  the  rights  of  his  position, 
commercially,  in  relation  to  all  the  world  around  him,  or  he  will 
be  defrauded  and  cheated  at  all  points.  No  one  should  spend  more 
than  he  can  afford.  It  is  equally  necessary  for  nations  to  guard 
their  commercial  rights,  and  be  economical,  as  for  individuals. 
Every  nation  stands  in  similar  relations  to  other  nations,  commer- 
cially, as  do  individuals  to  those  about  them.  If  either  should 
cease  to  exercise,  or  relax  their  care,  in  these  respects,  their  rights 
would  instantly  be  invaded,  and  they  would  suffer  injury.  Free 
Trade  is  preposterous. 

Mr.  .Jacobs  says  :  "  It  may  be  observed,  that  the  world  is  very 


234         MONEY  AS  THE  "TOOLS  OF  TRADE." 

little  really  richer  or  poorer,  from  the  portion  of  metallic  wealth 
that  may  be  distributed  over  its  surface.  .  .  The  only  benefit  to 
the  world  in  general,  from  the  increase  of  these  metals,  is,  that  it 
acts  as  a  stimulus  to  industry." 

The  first  of  these  remarks  is  very  sensible,  natural,  and  in  one 
sense  true,  though  it  needs  explanation;  but,  as  much  as  we  respect 
Mr.  Jacobs,  and  feel  obliged  to  him,  for  his  incomparable  work  on 
the  history  of  the  precious  metals,  we  must  say,  that  the  second  is 
somewhat  in  the  dark,  though  we  acknowledge  there  was  a  founda- 
tion even  for  that.  What  he  doubtless  means  by  the  first  remark, 
is  true,  viz.,  that  the  wealth  of  society  does  not  so  much  consist  in 
the  precious  metals,  and  in  money,  reckoning  their  actual  amount, 
as  is  commonly  supposed.  He  says  elsewhere,  that  "  the  gold  and 
silver  of  a  country  can  scarcely  amount  to  one  hundredth  part  of 
its  wealth."  We  go  even  farther  than  that.  But  though  money  is 
but  a  small  fraction  of  the  wealth  of  a  country,  so  small  that  it  is 
hardly  worth  counting,  for  its  comparative  amount,  yet  it  occupies 
a  very  important  position  as  the  "tools"  of  its  trade;  and  those 
portions  of  the  precious  metals  which  are  appropriated  to  other  pur- 
poses, being  generally  three  or  four  to  one  of  the  money,  occupy  a 
still  more  important  position  as  thefovndation  of  the  value  of  money. 
These  two  considerations  impart  to  the  precious  metals,  in  all  their 
forms,  a  high,  even  a  momentous  importance.  They  seem  to  be 
as  much  a  Providential  provision  for  man,  and  for  the  necessities 
of  society,  as  the  laws  of  nature,  and  it  is  hardly  too  much  to  say, 
that  they  do  in  fact  constitute  one  of  those  laws.  They  certainly 
grow  out  of  them,  and  their  uses  have  that  foundation.  Gravitation 
has  no  more  power  over  its  own  sphere,  than  the  precious  metals 
have  in  theirs,  and  is  scarcely  more  beneficent  in  its  domain,  than 
the  latter.  Man  can  no  more  dispense  with  the  precious  metals, 
than  creation  can  with  one  of  its  great  laws. 

We  hold,  therefore,  that  the  second  remark  above  cited  from 
Mr.  Jacobs,  is  derogatory  to  the  precious  metals,  and  detracts  not 
less  from  their  importance,  than  from  the  dignity  of  their  position 
in  the  social  state.  We  think  we  clearly  see  the  light,  or  rather 
the  darkness,  in  which  he  stood,  when  he  made  it.  It  is  no  dero- 
gation from  his  merit  as  an  indefatigable  and  successful  investigator 
in  the  line  of  his  pursuit,  to  suppose,  that  he  could  not  make  every 
acquisition  possible  to  man,  and  that  he  had  not  well  considered 
the  ground  he  occupied  in  this  remark,  or  the  things  which  it  com- 
prehended.    If,  by  "  a  stimulus  to  industry,"  he  meant  only  the  art 


MONEY  AS  THE  "TOOLS  OF  TRADE."  235 

and  labor  bestowed  on  those  portions  of  the  precious  metals  which 
are  appropriated  to  other  uses  than  that  of  money,  as  is  quite  prob- 
able he  did,  judging  from  his  Free-Trade  views,  he  has  certainly 
circumscribed  himself  to  a  very  narrow  field  —  not  narrow  in  itself, 
for  it  is  a  broad  one — but  narrow  as  compared  with  that  which  he 
did  not  survey,  and  which  is  by  far  the  richest  and  most  important, 
yiz.,  the  sway  which  gold  and  silver  wield  over  human  affairs,  and 
over  the  destiny  of  man,  as  the  instrument  or  "tools  of  trade."  If 
he  had  seen  and  appreciated  this,  it  is  not  conceivable,  that  he 
could  have  made  so  derogatory  a  remark,  "The  only  benefit,"  &c. 

Like  all  the  Free-Trade  economists,  Mr.  Jacobs  says:  "Gold 
and  silver"  —  we  cite  his  own  words  —  "  are  merely  commodities;" 
and  like  them,  we  understand  him  as  holding  to  the  doctrine  of 
equivalents  in  exchanges.  And  yet  he  says :  "  During  the  whole 
of  this  reign,  [of  Henry  VII.,]  trade  had  increased  both  in  imports 
and  exports ;  and  as  the  latter  regularly  exceeded  the  former,  a 
great  increase  in  the  deposite  of  the  precious  metals,  either  in  the 
form  of  coin  or  of  bullion,  must  have  taken  place  in  this  kingdom." 
Here,  in  the  first  place,  he  has  granted  all  we  ask,  on  the  question 
of  the  balance  of  trade,  in  recording  an  historical  fact  ;  but  how,  as 
a  Free-Trade  economist,  asserting  that  money  occupies  the  same 
position  as  other  commodities  in  trade,  is  "merely  a  commodity," 
and  that  in  all  trade  the  exchanges  are  equivalents,  he  could  make 
the  exports  exceed  the  imports,  is  more  than  we  can  see. 

It  has  already  been  seen,  in  the  current  of  our  argument,  that,  in 
consideration  of  the  undeveloped  resources  of  this  country,  of  the 
enterprise  of  its  population,  and  of  the  high  value  which  money  has 
always  sustained  here,  as  compared  with  its  value  in  Europe  and 
other  foreign  parts,  it  is  scarcely  possible  for  us  to  have  too  much 
of  it.  It  is  generally  supposed,  that  eighty  millions  of  cash,  or 
specie,  is  necessary  for  our  domestic  exchanges  and  common  busi- 
ness purposes.  This  is  used  many  times  over,  and  some  portions 
of  it  may  pass  through  hundreds  of  hands,  in  the  course  of  a  year.* 
It  has  been  estimated  that  more  than  four  hundred  millions  of  dol- 
lars are  annually  required  for  the  movements  of  the  domestic 
trade  of  the  country  alone.     Eighty  millions  of  specie,  therefore, 

*  Since  writing  this  chapter,  we  have  been  told  of  a  case  of  fact,  well  certified, 
in  which  a  man,  with  $1,000  capital,  traded  to  the  amount  of  $100,000  in  twelve 
months.  Is  not  money  the  "  tools"  of  trade  ?  Without  this  cash,  none  of  this 
business  could  have  been  done.  How  emphatically  does  this  fact  illustrate  the  im- 
portance of  cash  to  a  nation,  and  the  misfortune,  the  incalculable  disadvantage,  of 
having  too  little  —  of  having  it  drawn  away  by  Free  Trade  to  foreign  parts. 


230  MONEY    AS    THE    "TOOLS    OF    TRADE. 

as  the  basis  of  a  currency  required  by  all  the  business  and  trade  of 
the  country  —  more  especially  as  a  large  fraction  of  this,  perhaps 
nearly  a  moiety,  is  itself  a  part  of  the  currency  —  may  be  consid- 
ered a  sniall  enough  supply  for  all  demands.  Prooably  one  hun- 
dred millions,  for  present  population  and  business,  in  an  ordinary 
state  of  things,  would  be  more  convenient.  There  is  no  use  in 
having  more  cash  in  the  country  than  its  business  or  trade  requires, 
as  more  would  be  idle.  But  that  amount  is  important  —  is  indis- 
pensable for  the  convenience  and  prosperity  of  the  people.  Its 
chief  function  is  to  constitute  the  basis  of  the  currency,  the  bulk 
of  which  is  always  paper  in  a  civilized,  active,  commercial  commu- 
nity. But  the  cash,  or  specie,  must  be  in  the  country,  in  abeyance 
to  demand  ;  else  the  currency  is  unsound,  being  irredeemable. 

Nothing  but  the  protective  policy  can  keep  the  necessary  amount 
of  specie  in  the  country.  This  is  evident  from  what  is  elsewhere 
proved.  "  History  is  prophecy."  The  past  proves  what  the 
future  will  be.  There  never  was  a  time  of  no  duties,  as  under  the 
confederation  ;  or  of  low  duties,  as  for  the  few  years  previous  to 
the  tariff  of  1S24,  and  previous  to  that  of  1842  ;  when  the  specie 
did  not  leave  the  country,  and  the  currency  break  down.  The 
reason  is,  that  low  or  anti-protective  duties  always  run  the  country 
in  debt  to  foreign  parts,  by  buying  more  than  is  sold  ;  and  no  for- 
eign balances  against  the  country  can  be  settled,  except  by  cash, 
weighed  in  the  scales.  Consequently,  the  specie  is  required,  and 
must  go  ;  and  unless  the  banks  suspend,  to  stop  it,  it  must  continue 
to  go,  till  these  balances  are  setded.  One  hundred  millions  of  bal- 
ances of  this  kind  against  us,  would  at  any  time  drain  the  country 
of  a  sufficient  amount  of  specie,  to  distress  and  embarrass  it ;  and 
without  an  extension  of  credit,  it  would  probably  take  all  the  specie. 
But  the  commercial  history  of  the  country  demonstrates,  that  a  short 
period  of  low,  anti-protective  duties,  will  run  up  more  than  a  hun- 
dred millions  of  balances  against  us.  That  is  the  reason,  and  the 
sole  reason,  of  all  the  currency  troubles  of  the  country,  in  times  past.* 

•  Such  was  the  distressing  eflfeet  of  the  absence  of  specie  from  the  country,  or 
of  the  want  of  "tools''  of  trade,  in  consequence  of  low  duties,  just  before  the 
tariff  of  1842  came  to  the  rescue,  that  in  some  parts  of  the  interior  of  Pennsyl- 
vania, the  people  were  obliged  to  divide  bank-notes  into  halves,  quarters,  eighths, 
and  so  on,  and  agree,  from  necessity,  lo  use  them  as  money.  In  Ohio,  with  all  her 
abundance,  it  was  hard  to  get  money  to  pay  taxes.  The  sheriff  of  Muskingum 
county,  as  stated  by  the  Guernsey  Times,  sold  at  auction  one  fonr-horse  wagon,  at 
$5.50;  10  hogs,  at  6|  cents  each  ;  2  horses  (said  to  be  worth  from  $50  to  $75  each), 
at  $2  each  ;  two  cows,  at  $1  each  ;  a  barrel  of  sugar,  for  $1.50  ;  and  a  "  Store  of 
goods"  at  that  rate.    In  Pike  county,  Missouri,  as  stated  by  the  Hannibal  Journal, 


MONEY    AS    THE    "TOOLS    OF    TRADE."  237 

A  man  of  business,  in  a  sound  state,  as  to  his  own  private  finan- 
ces, can  not  fail,  if  he  should  try,  so  long  as  lie  does  not  buy  more 
than  he  sells.  It  is  the  same  with  a  nation.  Having  once  in  its 
bosom  cash  enough  for  its  business,  or  trade,  domestic  and  foreign, 
it  will  always  have  enough,  till  it  begins  to  buy  of  foreign  parts 
more  than  it  sells  to  them,  take  the  foreign  trade  as  a  whole.  Then 
the  cash  must  go,  to  settle  balances,  whatever  be  the  amount.  If 
they  be  equal  to  half  of  the  specie  in  the  country,  then  half  of  it 
must  go  ;  if  equal  to  the  whole,  the  whole  must  go ;  or  the  debts 
must  be  protested,  or  be  arranged  ;  in  any  case,  if  the  whole  does 
not  go,  the  debts  must  remain  unpaid. 

The  foreign  debts  of  the  United  States  are  probably  at  this  mo- 
ment more  than  three  times  as  much  as  the  amount  of  specie  in  the 
whole  country  ;  and  they  were  all  created  in  limes  of  low  duties, 
and  by  reason  of  them.  But  those  which  were  not  settled  by  pri- 
vate bankruptcy  and  state  repudiation,  thus  returning  home  from 
inability  or  bad  faith,  have  been  arranged,  and  the  nation  pays, 
through  the  debtors,  from  twelve  to  fifteen  millions  annually,  in  the 
shape  of  interest,  with  the  principal  hanging  over  its  head.  It  is  so 
much  foreign  debt  against  the  country;  and  if  justice  be  done,  the 
interest  must  always  be  paid.* 

the  sheriff  sold  3  horses,  at  $1.50  each;  1  lars:e  ox,  at  12|  cents;  5  cows,  2  steers, 
and  1  calf,  the  lot,  at  $3.25;  20  sheep,  at  13|  cents  each  ;  24  hogs,  the  lot,  at  25 
cents ;  1  ei2;ht-day  clock,  at  $2.50 ;  a  lot  of  tobacco,  7  or  8  hogsheads,  at  $5 ;  3 
•stacks  of  hay,  at  25  cents  each  ;  and  1  stack  of  fodder,  at  25  cents.  This  is  but 
an  epitome  of  the  general  state  of  the  country  at  that  time,  arising  from  this  cause, 
though  some  parts  suffered  more  than  others,  as  those  above  named. 

•After  the  bank  of  the  United  States  was  wound  up,  as  a  national  institution, 
by  the  refusal  of  a  new  charter,  the  slates  were  stimulated,  by  the  action  of  the 
federal  executive,  to  the  creation  of  a  host  of  banks  without  a  specie  basis,  and  to 
extravagant  expenditures  for  internal  improvements.  From  1820  to  1830,  during 
the  existence  and  action  of  the  national  bank,  only  22  state  banks  were  erected, 
with  an  aggregate  capital  of  only  $8,000,000;  whereas,  between  1830  and  1840, 
392  banks,  or  571,  including  branches,  sprang  into  existence,  with  a  nominal  cap- 
ital of  $213,000,000.  (See  House  Document  lll,2dSess.  26th  Consress.)  Alarge 
portion  of  these  banks,  being  unnaturally  forced  into  being,  without  any  solid  foun- 
dation, failed  of  course,  in  the  commercial  revulsion  that  followed. 

The  history  of  the  state  debts  shows,  that  from  1820  to  1825,  the  increase  of  state 
bonds  was  $12,000,000;  from  1825  to  ]830,  the  increase  was  $13,000,000;  from 
1830  to  1835,  when  this  unnatural  stimulant  began  to  operate,  the  increase  sud- 
denly rose  to  $40,000,000;  and  from  1835  to  1840,  it  was  $109,000,000,  nearly 
the  whole  of  which  was  issued  in  1835  and  1836,  before  the  destruction  of  general 
credit.  The  imports  of  1836,  tempted  by  the  same  seductive  influences,  under  a 
system  of  low  and  falling  duties,  were  $61,000,000  in  excess  of  the  exports;  and 
the  home  speculations  and  adventures,  prompted  by  this  cause,  were  on  the  same 
scale  of  extrnvagance.  All  these  state  debts,  or  nearly  all,  went  abroad  to  satisfy 
the  commercial  balances,  which  were  heaping  up  against  the  country. 


238  MONEY    AS    THE    "TOOLS    OF    TRADE." 

But  the  nation  has  never  run  in  debt  to  foreign  parts,  under  the 
existence  and  action  of  a  protective  policy  ;  and  it  has  never  paid 
any  foreign  debts  except  by  that  policy.  Such  are  the  facts.  It  is 
not  intended  to  say,  that  no  foreign  engagements  have  ever  been 
met,  under  a  system  of  low,  anti-protective  duties  ;  but  only,  that 
foreign  engagements,  in  the  aggregate,  have  never  been  liquidated, 
but  always  increased,  under  that  system  ;  and  that  the  aggregate 
has  only  been  lessened,  and  credit  revived  only,  under  the  action 
of  a  system  of  protective  duties. 

Moreover,  the  currency  can  never  fail,  will  always  be  sufficient,\ 
and  can  never  be  unsound,  under  an  adequate  system  of  protective/ 
duties.  Nothing  more  is  meant  here  by  the  term,  (ideqiiate,  than 
that  the  system  shall  be  strong  enough  to  prevent  foreign  commer- 
cial balances  accumulating  against  the  country  ;  and  it  is  supposed, 
that  a  tariff  based  on  the  principles  of  that  of  1842,  and  as  a  whole 
equally  protective,  will  be  sufficient.  It  is  also  supposed,  that  the 
le^nslation  for  the  reo;ulation  of  the  currency,  shall  be  ordinarily 
prudent  and  effective.  A  bank,  here  and  there,  might  fail,  from 
mismanai,rement,  or  other  cause  ;  but  such  an  event,  rarely  occur- 
ring, coidd  no  more  disturb  or  impair  the  general  system,  than  the 
failure  of  a  merchant,  in  the  city  of  New  York,  could  shake  the 
commercial  fabric  of  this  great  emporium.  So  long  as  no  foreign 
commercial  balances  are  accumulating  against  the  country,  the  spe- 
cie in  it  would  remain  as  the  basis  of  the  circulating  medium,  and 
a  part  of  it.  And  the  small  balances  in  favor  of  the  country,  annu- 
ally accruing,  as  under  the  tariff  of  1842,  showing  that  the  country 
is  selling  more  than  it  buys,  would  gradually  enlarge  and  fortify 
the  basis  and  body  of  the  currency.  It  could  neither  (tiil,  nor  be 
insufficient,  nor  unsound,  any  more  than  a  private  individual  could 
fail,  who  has  once  started  strong,  and  never  buys  more  than  he  sells, 
but  always  sells  more  than  he  buys.  All  the  money,  and  more  too, 
would  be  in  the  country  —  would  always  be  here;  and  therefore 
the  currency  would  always  be  sound,  and  must  remain  so.  All  the 
talk  about  overtrading,  and  about  the  alternate  inflations  and  con-  , 
tractions  of  the  currency,  has  arisen  entirely  from,  and  only  applies 
to,  a  state  of  things,  which  the  want  of  a  protective  system  brings 
about. 

As  to  inflations  and  contractions  of  the  currency,  they  are  all 
produced  by  changes  in  the  policy  of  government.  Banking  is 
tradinsr  in  money,  and  the  same  principle  of  self-preservation  con- 
trols this  branch  of  trade,  as  all  others.    It  will  not  commit  suicide. 


MONEY    AS    THE    "  TOOLS    OF    TRADE."  239 

as  would  be  the  case,  by  a  voluntary  sacrifice  of  the  confidence  of 
the  public.  Nor  will  it  voluntarily  do  an  injury  to  that  public,  on 
whose  prosperity  it  depends  for  all  its  profits  of  business.  It  would 
be  absurd  to  suppose  it,  because  it  is  a  moral  impossibility.  It  is 
only  the  irresistible  pressure  of  a  superior  power,  that  of  govern- 
ment, which  leads  to  such  results  as  sudden  and  violent  contractions 
and  expansions  of  bank  issues. 

It  is  true,  indeed,  that  this  view  of  this  subject,  presents  quite  a 
different  aspect  to  that  portion  of  our  history,  from  1830  to  1S40, 
when  compared  with  that  which  was  forced  upon  the  public  at  the 
time,  by  men  in  power,  who  charged  all  the  fault  of  those  expan- 
sions and  sudden  contractions  of  the  currency  to  the  banks.  It 
was  the  fault  of  the  government  exclusively,  consisting  in  the  fitful 
fluctuations  of  its  policy,  and  in  having  adopted  a  plan  of  Free 
Trade.  The  banks  accommodated  the  people  when  and  as  far  as 
they  could.  That  was  called  an  inflation  or  expansion  of  the  cur- 
rency ;  but  when  the  government,  by  its  policy,  forced  them  to 
diminish  their  discounts  and  issues,  which  crippled  business  and 
trade,  that  was  called  contraction. 

All  the  currency  troubles  of  the  country,  all  bank  suspensions,^"^ 
all  bank  troubles  of  a  serious  nature  to  the  wide  community,  all  / 
insufficiency  and  unsoundness  of  the  circulating  medium,  and  such  V 
like,  have  occurred  only  in  the  absence  of  a  protective  policy  of  ) 
the  government  over  the  commercial  interests  of  the  people.  Such  I 
is  hisfonj.  It  is,  therefore,  fair  to  say,  that  these  troubles  come  m  \ 
consrfjiteiice  of  such  defect.  If  it  had  been  only  once,  or  twice,  or 
three  times,  the  evidence  would  be  less  strong.  But  it  has  been 
maiiy  times,  without  a  single  excejitioti  to  the  rule. 


k 


240  PAPER-MONEY    AND    BANKING. 


CHAPTER    XVI. 

PAPER-MONEY    AND    BANKING. 

Tlie  Principle  of  Credit — The  United  States  built  ap  by  Credit. — Gold  and  Silver  a  Credit 
Currency. — la  Bank-paper  Money? — The  Invention  of  Paper-Money  a  great  Advance 
in  Civilization — Facts  to  illustrate  its  Economy  and  NerCf^sity — It  greatly  augments  the 
Facilities,  Scope,  and  Powers  of  Commerce. — Facts  and  Authorities  to  this  Point. — 
Banking  the  Instrument  of  Papor-Moiiey — The  American  System  of  Banking — Pria- 
ciples  and  Benefits  of  Banking. — Adam  Smith's  Doctiiiie  that  Paper-Money  banishes 
Specie,  not  applicable  to  the  United  States — The  Piecious  Metals  the  only  found  Basis 
of  Banking — Tl)e  visionaiy  and  unsettled  0[)inioi.8  of  European,  paiticularly  Biiti.sh 
Economists,  as  to  the  Basis  of  Banking.— Sir  Robert  Peel  right  at  last  in  his  Bill  of  1844. 

A  Government  Bank  necessarily  in  a  false  Position. — The  Subtreasury  a  Government 

gank. Treasury-Notes  are  Post-Notes. — All  the  Functions  of  the  Treasury,  by  making 

it  a  Government  Bank,  merged  in  that  Bank — The  Eifecta  Danger,  and  Power  of  this 
Institution  — It  subverts  the  Banking  System  of  the  Country — The  Instincts  and  Propen- 
sity of  the  Federal  Government  for  Banking,  as  illustrated  in  the  Subireasury. 

As  we  are  now  approaching  that  department  of  the  monetary- 
system,  which  has  much  to  do  with  the  principle  of  credit  or  faith, 
it  may  be  well  to  say  a  few  words  on  this  great  bond  of  the  social 
state.  Endeavors  have  been  made  to  scandalize  credit,  by  represent- 
ing it  as  synonymous  with  failh  reposed  in  false  pretences  ;  and  on 
the  basis  of  this  assumption,  a  theory  has  been  set  up,  that  credit 
is  a  vice,  and  ought  not  to  be  tolerated.  This  doctrine  was  first 
promulgated  from  the  most  eminent  civil  position  in  the  land  ;  and 
the  unearthly  scream,  the  barbarian  whoop  of  a  servile  minion,  to 
the  great  affright  of  men  less  mad,  sitting  in  grave  assembly  in  the 
halls  of  legislation,  gave  out  the  word,  "  Perish  credit !"  This  is 
a  libel  on  humanity,  and  on  virtue.  The  great  benefit  and  blessing 
of  Christian  civilization,  is  the  increase  and  strengthening  of  faith 
amono-  men  ;  and  not  the  least  important  ramification  of  this  virtue, 
is  commercial  credit.  Tiiere  may  be  too  little  ;  it  is  impossible 
there  should  be  too  much  of  it.  Its  prevalence  and  growth  are 
proof  of  a  sound  state  of  public  morality. 

It  was  by  credit,  or  a  sound  state  of  public  morality  —  which  is 
the  same  thing  —  that  the  United  States  rose  from  their  small  be- 
ginning to  their  present  magnitude.  Commercial  credit  was  one 
of  the  most  important  elements  of  society  during  our  colonial  his- 
tory ;  for  there  was  very  little  money.  Public  faith  of  this  very 
kind,  was  the  great  secret  of  our  success  in  the  revolutionary  war ; 


PAPER-MONEY    AND    BANKING.  241 

for  money  which  we  had  not,  or  credit  which  h  the  same  thin<^,  is 
the  sinews  of  war.  It  was  commercial  integrity  which  carried  the 
nation  through  ihe  years  of  the  confederation  ;  for  there  was  no 
money  to  begin  with,  and  we  were  constantly  running  in  debt.  On 
the  verge  of  dissolution  as  a  political  body,  on  account  of  commer- 
cial embarrassments,  it  was  credit  that  saved -us  at  the  time  of  the 
adoption  of  the  federal  constitution.  It  was  the  revival  of  credit 
by  the  establishtuent  of  a  national  bank  in  1791 ,  that  gave  us  a  new 
start ;  but  there  was  very  little  money  in  the  country.  It  was  the 
vital  power  of  the  credit  of  that  institution,  which  carried  the  nation 
onward  in  a  career  of  prosperity  for  twenty  years;  and  in  the  mean- 
time, state  banks  arose  in  various  parts  of  the  country,  apparently 
diffusino:  a  beneficent  influence.  But  the  war  of  1812,  and  the 
non-existence  of  a  national  bank  for  four  or  five  years,  brought  us 
into  commercial  troubles  again.  But  credit  came  to  our  aid,  a  new 
national  bank  was  chartered  in  1816  for  twenty  years  more,  and 
but  for  the  want  of  an  adequate  protective  system  for  a  few  years 
previous  to  the  tariff  of  1824,  which  sent  the  specie  out  of  the 
country,  there  would  have  been  uninterrupted  prosperity.  It  was 
credit  that  carried  the  nation  throut>h  that  trial,  and  raised  it  ao;ain 
to  unexampled  commercial  vigor,  under  the  tariff  of  1824,  and  on- 
ward, till  the  low  duties  of  the  last  years  of  the  compromise  tariff 
of  1833,  again  drew  off  the  precious  metals,  and  doomed  the  nation 
to  start  again  on  credit.  From  the  beginning  of  our  history,  down 
to  this  time,  credit  has  been  the  soul,  and  the  great  power  of  the 
nation  ;  and  no  people  on  earth  are  more  indebted  to  this  virtue. 
There  must  always  be  a  substantial  ground  for  credit;  or  else  it  ^ 
can  not  flourish.  Thal_grojiiid  is  public  virtue  —  moral  integrity.!^ 
It  hardly  need  be  said,  that  all  public  measures  which  nourish 
credit,  secure  its  foundations,  surround  it  with  safeguards,  and  build 
it  up  a  glorious  temple,  in  any  community,  constitute  one  of  the 
most  important  and  effective  elements  of  public  economy. 

We  proceed  to  observe,  that  gold  and  silver,  used  as  money, 
officiate  in  two  representative  capacities,  one  representing  the  joint 
values  of  these  metals  in  all  the  uses  to  which  they  are  applied  ; 
and  the  other  representing  every  species  of  property  of  a  commer- 
cial value,  in  its  character  as  the  recognised  currency  of  the  world, 
in  the  way  of  expressing  that  value,  and  in  consummating  commer- 
cial exchanges.  It  is  the  first  of  these  representative  functions 
which  we  have  occasion  now  to  notice,  for  the  purpose  of  reviving 
a  statement  before  made,  viz.,  that  gold  and  silver,  used  as  money, 
10 


242  PAPER-MONEY    AND    BANKING. 

are  a  mere  credit  currency,  representing  all  the  values  arising  from 
the  great  variety  of  their  uses  ;  and  their  credit  is  based  upon  these 
values,  their  value  as  money  being  but  a  fraction  of  the  whole, 
itself  borrowed  from  these  other  values.  It  is  certain,  as  before 
shown,  that  they  never  would  have  been  used  as  money,  but  for 
their  other  values;  and  therefore,  as  money,  their  credit  may  be 
said  to  be  based  entirely  upon  them. 

Our  object  in  making  this  idea  prominent  here,  is  to  show,  that 
money,  in  all  forms  and  substances,  is  a  credit  currency,  and  de- 
rives its  credit  from  considerations  extraneous  to  itself.  There  is, 
however,  a  substantial  advantage  in  favor  of  gold  and  silver,  as 
money,  ari<in2:  from  the  fact,  that  they  are  imperishable  parts  of  the 
great  masses  of  the  same  substances,  always  worth  their  weight  for 
any  of  the  great  variety  of  uses  which  constitute  their  value,  and 
are  capable,  at  any  time,  of  being  put  back  into  those  uses.  This 
is  what  is  commonly  called  Intrinsic  value.  The  gold  and  silver, 
contained  in  money,  are,  confessedly,  substances  which  have  a 
value  in  themselves  for  other  uses,  equal  to  their  weight.  Never- 
theless, when  employed  as  money,  they  rest  on  the  basis  of  that 
credit  which  they  derive  from  their  adaptation  to  other  uses.  These 
values  are  sufficient  to  constitute  gold  and  silver,  in  the  form  of 
money  or  bullion,  an  adequate  basis  for  a  secondary  currency,  if 
the  interests  of  the  public  and  of  trade  require  it. 

Some  deny,  that  a  paper  medium  is  money  ;  others  even  deny, 
that  it  is  a  currency.  The  second  appears  to  be  the  denial  of  a 
fact  ;  and  the  principle,  as  we  suppose,  on  which  the  first  denial  is 
made,  viz.,  because  bank  paper  is  no  more  than  a  representative, 
would  also  prove,  that  an  eagle  and  a  dollar  are  not  money;  for,  as 
before  shown,  they  also  are  mere  representatives.  But  it  is  not 
much  matter  what  things  are  called,  if  we  are  understood  ;  and 
those  names  are  doubtless  best,  in  the  use  of  which  we  can  be  best 
understood.  Bank  paper,  passing  for  money,  is  commonly  called 
money,  and  that  is  enough  to  justify  a  conformity  to  usage. 

Assuming  that  no  paper-money  ought  ever  to  be  in  circulation, 
which  is  not  good  for  the  amount  in  specie,  whenever  demanded 
by  the  holder  ;  and  that  no  institutions  for  such  issues  should  be 
authorized,  without  being  obliged  to  conform  to  this  rule,  it  may 
be  said,  that  the  invention  of  paper-money,  on  such  a  basis,  has 
proj/ed  scarcely  of  less  importance  to  society  than  that  of  a  metallic 
currency.  Each  was  a  great  advance  in  civilization.  So  incon- 
venient is  the    primitive    mode    of   barter,  that,  even  where  the 


PAPER-MONEY    AND    BANKING.  243 

precious  metals  are  wanting,  men  but  little  removed  from  barba- 
rism, can  not  be  induced  to  return  to  it;  but  they  will  substitute 
something  for  a  common  currency,  wliich  always  has  a  market 
vaUie  for  exportation,' by  which  gold  and  silver,  in  some  foreign 
country,  can  be  realized,  thus  recognising  and  establishing  the 
great  principle  of  a  specie-basis.  In  California,  hides  are  said  to 
be  the  common  currency,  and  though  inconvenient,  the  basis  is  as 
valid  as  that  of  the  best  paper-money  in  the  United  States  or  in 
Europe,  because,  being  in  demand,  they  will  be-redeemed  in  the 
way  of  trade.  These  hides  discharge  the  functions  of  money, 
are  money,  and  have  a  value  in  themselves  as  truly  as  gold  and 
silver.  The  adoption  even  of  such  a  currency  is  a  great  improve- 
ment on  the  mode  of  barter.  But  the  adoption  of  a  gold  and  sil- 
ver currency,  or  its  substitution  for  barter,  was  a  convenience  to 
society,  the  measure  of  which  can  hardly  be  estimated. 

Before  gold  and  silver  had  become  a  universal  medium,  con- 
venience and  necessity,  in  ancient  times,  and  in  some  countries, 
forced  men  to  invent  common  mediums,  to  escape  from  barter. 
Homer  says  that  the  armor  of  Diomede  cost  nine  oxen.  The 
Abyssinians  have  used  salt  as  money,  because  it  was  scarce  and 
precious.  In  Newfoundland,  dried  cod  were  once  used  as  money, 
and  in  Scotland,  nails.  In  some  parts  of  India  and  Africa,  shells 
have  performed  this  function.  The  legal  currency  of  Lacedaemon 
was  iron,  and  of  ihe  early  Romans,  copper.  We  hear  of  a  variety 
of  other  currencies  among  barbarians.  All  these,  and  many  other 
examples,  indicate  how  strongly  nations  and  tribes  were  and  have 
been  pressed  by  convenience  and  necessity,  to  agree  on  a  common 
currency,  before  gold  and  silver  had  got  into  general  use,  as  such. 

But  since  the  adoption  of  silver  and  gold  as  a  currency,  some 
portions  of  the  world  have  advanced  so  much  and  so  far  in  the 
modes  of  civilization,  that  an  improvement  on  a  metallic  currency 
became  as  necessary  to  meet  the  exigencies  of  the  commercial 
world,  as  that  improvement  on  the  system  of  barter.  Good  and 
important  as  a  metallic  currency  was,  when  first  mvented  as  a  sub- 
stitute for  barter,  in  process  of  time  —  when  faith  between  men 
grew  with  the  growth  of  civilization,  to  a  high  value,  and  when 
great  expedition  was  required,  in  frequent  and  large  exchanges  — 
a  metallic  currency  became  an  obstacle,  an  impediment  to  the  ma- 
chinery of  the  commercial  world,  not  to  the  same  extent,  but  some- 
what in  the  same  manner,  as  barter  was  before  it.  It  was  incon- 
venient, unwieldy,  gross,  and  as  such,  incapable  of  those  quick 


244  PAPER-MONEY    AND   BANKING. 

and  large  operations  between  remote  points,  which  the  state  of 
society  and  of  the  commercial  world  required.  Tiie  invention  of 
paper-money  was  equally  natural,  and  equally  necessary  to  the 
improved  state  of  society  in  which  so  much  business  was  required 
to  be  done,  on  the  principle  of  faith,  under  proper  forms  and  se- 
curities, as  originally  was  the  invention  of  a  metallic  currency  as 
a  substitute  for  barter.  It  became  impossible  to  do  the  business 
of  the  commercial  world  without  it ;  and  it  is  found  scarcely  less 
convenient  in  the  ordinary  transactions  of  trade,  than  in  the  larger 
operations  of  commerce. 

The  following  facts  will  show  how  utterly  impossible  it  would 
be  to  do  the  business  now  required,  with  a  metallic  currency.  The 
receipts  and  payments  of  six  banks,  in  the  city  of  New  York,  on 
a  specie  basis  of  $3,000,000,  fronri  the  1st  to  the  ]Oth  of  Decem- 
ber, 1846,  were  more  than  $60,000,000,  with  an  actual  use  of  less 
than  $200,000  of  specie  for  the  whole  amount ;  or  with  less  than 
$20,000  of  specie  a  day,  for  average  transactions  of  $10,000,000  . 
a  day.  There  were,  at  the  time,  23  banks  in  the  city.  What 
amount  of  business  the  remaining  17  did,  in  the  same  ten  days, 
we  are  not  informed. 

As  instances  of  the  comparative  expense  of  making  exchanges, 
between  remote  points,  by  specie  and  paper  mediums,  or  through 
banks  and  a  metallic-currency  system,  the  following  facts  are  suf- 
ficiently instructive  :  In  the  operation  of  the  subtreasury,  the  gov- 
ernment of  the  United  States  paid  $3,950,  in  November,  1846, 
for  the  remittance  of  $503,000  in  cash,  from  New  York  to  New 
Orleans ;  and  in  December,  following,  $9,000  for  remitting 
$1,300,000  in  cash,  from  the  same  city  to  the  same;  whereas, 
other  remittances,  about  the  same  time,  amounting  in  all  to 
$1,669,314,  from  New  York  to  New  Orleans,  through  the  agency 
of  banks,  cost  the  government  —  0.  During  the  existence  of  the 
bank  of  the  United  States,  all  the  banking  business  of  the  govern- 
ment, averaging  some  twenty  millions  a  year,  cost — 0.  The  trans- 
fer of  specie,  between  the  United  States  and  Great  Britain,  costs 
at  least  3^  per  cent.,  or  $35,000  for  every  million. 

Besides  the  risk  and  expense  of  transactions  of  commerce  with 
gold  and  silver,  between  remote  points  —  remote  as  many  of  the 
above-named  transactions  of  the  New  York  banks  —  it  would  have 
been  impossible  to  do  but  a  small  fraction  of  the  above  business 
of  $60,000,000,  with  gold  and  silver,  in  the  same  time,  even  if 
the  parties  were  all  in  New  York.     Experience  is  the  same  in  all 


PAPEK-MONEY    AND    BANKING.  245 

parts  of  the  commercial  world,  and  with  all  parties  concerned  in 
trade.  Men  would  no  more  consent  to  go  back  to  a  pure  metallic 
ciirrenny,  than  they  who  had  once  experienced  the  benefits  of  such 
a  medium,  would  have  consented  to  go  back  to  the  mode  of  trade 
by  barter.  The  invention  of  paper-money  is  not,  perhaps,  so 
great  an  improvement  on  an  exclusive  metallic  medium,  as  the  lat- 
ter was  on  barter ;  but  it  is  too  great  a  convenience  to  all  parties, 
in  ways  that  will  occur  to  every  man's  experience,  whether  doing 
much  or  little  business;  whether  receiving  or  transmitting  by  mail 
or  otherwise,  five  dollars,  or  a  hundred,  or  thousands,  or  tens  of 
thousands,  on  a  piece  of  paper,  which,  if  lost  by  the  way,  is  yet 
no  loss;  or  whether  he  be  travelling,  or  sleeping  in  his  own  house, 
and  would  feel  insecure  with  specie  in  his  charge,  but  perfectly 
safe  with  a  piece  of  paper,  equally  good,  and  payable  only  to  his 
order,  or  with  a  bank-note,  payable  on  demand,  concealed  from  any 
search  but  his  own  ;  and  withal,  it  is  such  an  immense  saving  of 
time  and  expense,  such  economy,  that  it  will  never  be  abandoned, 
till  men  are  more  inclined  to  go  backward  toward  barbarism,  than 
to  advance  in  civilization. 

Brande's  Dictionary,  of  which  M'Culloch  was  an  assistant  editor, 
and  who  doubdess  wrote  the  article  on  money,  says:  "The  use 
of  a  metallic  currency  is  accompanied  by  a  heavy  expense  ;  and 
tbere  is  a  much  greater  difficulty  in  effecting  payments  by  the 
agency  of  coins,  than  one  might  at  first  be  disposed  to  believe. 
If  the  currency  of  the  United  Kingdom  consisted  wholly  of  gold, 
it  would  certamly  amount  to  at  least  60  millions  sterling,  the  ex- 
pense of  which,  allowing  }  per  cent,  for  wear  and  tear,  and  loss 
of  coins,  could  hardly  be  estimated  at  less  than  t/tree  millions  [ster- 
ling] a  year.  [Under  the  head  of  bonks,  this  cost  is  stated  at 
^£3,250, 000  a  year.]  But  [even]  this  heavy  expense  is  really  a 
far  less  serious  obstacle  to  the  exclusive  use  of  the  precious  metals, 
than  their  weight,  and  the  trouble  and  expense  attending  the  car- 
rying them  about.  .  .  Hence  it  is,  that  all  commercial  nations  en- 
deavor to  fabricate  a  portion  of  their  money  of  some  less  valuable 
and  more  portable  material  than  bullion  ;  and  hence,  also,  the  ori- 
gin of  bills  of  exchange,  checks,  and  other  devices,  for  economizing 
the  use  of  money."  Jacobs,  speaking  of  the  condition  of  things 
as  far  back  as  in  the  12th  century,  also  says:  *'  The  risk  and  ex- 
pense of  conveying  it  [metal-money]  to  a  distance  were  still  more 
powerfully  opposing  obstacles.  Hence  arose  the  invention  of  bills 
&i  exchange." 


246  PAPER-MONEY    AND    BANKING. 

But  one  of  the  most  important  effects  resulting  fronn  the  use  of 
paper-money,  is  its  influence  in  augmenting  the  amount  of  trade, 
and  as  a  consequence,  of  weaUh.  Banking  is  the  necessary  in- 
strument of  paper-money,  without  which,  under  proper  regulations 
of  the  public  authorities,  it  can  not  be  issued  with  adequate  secu- 
rity to  all  the  parties  concerned.  A  banking  system  for  every  coun- 
try, should  be  the  creation  of  a  most  careful  and  wise  legislation, 
watched  with  a  supervision  and  guarded  with  penalties  corre- 
sponding with  the  importance  of  the  interests  involved.  Banking, 
like  all  human  institutions,  is  liable  to  be  abused  ;  but  the  abuse 
of  a  thing  is  not  conclusive  evidence  of  its  inutility.  The  wreck 
of  banking  institutions  in  the  United  States,  as  is  now  generally 
perceived,  has  been  rather  the  effect  of  the  political  action  of  the 
government,  than  of  any  tendency  inherent  in  the  system  ;  and 
the  result  of  all  this  experience  is,  the  establishment  of  banks  on 
a  footing,  and  with  securities  which  better  deserve  and  generally 
receive  the  public  confidence.  There  are  very  few  of  the  hun- 
dreds of  chartered  banks  in  the  country,  now  in  operation  (1847), 
the  paper  of  which  is  not  received  without  hesitation,  and  with 
entire  trust.  They  are  the  chief  reliance  for  the  currency  of  the 
country,  and  must  necessarily  be  so.  It  is,  therefore,  a  matter  of 
great  importance,  first,  that  the  banks  shoiiM  be  held  under  proper 
guards  against  ab(ise;  and  next,  that  tlieir  legitimate  operation,  in 
supplying  a  sound  arid  adequate  currency,  should  no-t  be  embar- 
rassed. 

Banking,  in  all  countries,  is  necessarily  based  on  Iilce  principles, 
as  the  objects  everywhere  are  similar.  Tn  the  United  States,  how- 
ever, the  necessity  of  augmenting  a  currency  usually,  almost  aFways, 
defective  in  amount,  as  compared  with  the  demands  of  trade,  has, 
perhaps,  been  more  urgent  than  in  European  countries.  Hence 
the  temptation  to  excessive  issues,  and  the  necessity  of  adequate 
provisions  of  law  to  check  and  hold  them  in  restraint.  The  coi»- 
ditions  of  bank  charters  are  devised  with  special  care  to  secure 
this  end,  at  the  same  time  that  this  species  of  trade  —  for  banking 
is  tradinir  in  monev — is  allowed  an  extent  commensurate,  aS'  near 
as  possible,  with  the  wants  and  security  of  the  public.  That  secu- 
rity can  only  be  made  good  by  conditions  which  shall  confine  the 
circulation  of  banks  within  the  limits  of  their  ability,  under  all  exi- 
gencies, to  redeem  their  paper  when  offered.  Their  credits  are 
legitimate,  only  as  they  are  based  on  their  stock,  dejwsites,  and  cir- 
culation ;  the  first  of  which  is  firm  and  reliable ;  but  the  other  two 


PAPER-MONEY    AND    BANKING.  247 

are  precarious,  the  management  of  which  constitutes  the  chief  task 
of  bank  financiering.     It  demands  experience  and  vigilance. 

The  usual  mode  of  banking  in  the  United  States  has  been  through 
the  agency  of  corporate  companies  ;  but  the  state  of  New  York  has 
recently  authorized  private  banking,  by  requiring  deposites  of  public 
funds  with  the  comptroller  as  security,  and  the  comptroller's  stamp 
on  all  such  private  issues  as  a  method  of  inspection  and  control. 

No  system  of  banking  can  stand,  except  as  the  notes  are  al- 
ways payable  on  demand,  in  legal  tender,  that  is,  specie.  They 
who  prefer  the  paper,  for  convenience,  are  usually  many  to  one 
of  those  who  want  the  specie.  The  chances  and  probabilities  of 
calls  for  specie  are  obliged  to  be  well  considered  by  the  bank,  so 
that  it  may  not  be  taken  by  surprise,  and  its  issues  are  regulated 
accordingly.  By  this  means,  the  country  is  usually  supplied  with 
an  amount  of  currency,  two  or  three  limes  in  excess  of  the  precious 
metals  in  the  vaults  or  at  the  command  of  the  banks,  with  safety 
and  profit  to  all  parties,  so  long  as  the  system  is  executed  with 
fidelity  ;  and  by  the  same  means  the  business  and  trade  of  the 
country  are  augmented  in  a  corresponding  degree.  None  can  fail 
to  see,  that  this  is,  and  ever  has  been,  a  great  blessing  to  the 
people  of  the  United  States,  and  the  means  of  increasing  their 
wealth,  and  consequently  the  power  of  the  nation,  to  an  incalculable 
amount. 

The  following  extract  from  a  work  recently  published  in  Lon- 
don, under  the  title  of  "  Lectures  on  the  History  and  Principles 
of  Ancient  Commerce,  by  A.  W.  Gilbart,"  will  serve  at  the 
same  time  as  an  illustration  of  this  subject,  and  as  an  expose  of  the 
principles  of  banking. 

"The  banker  who  first  makes  advances  to  the  agriculturist, 
the  manufacturer,  or  the  merchant,  in  his  own  notes,  stimulates  as 
much  the  productive  powers  of  the  country,  and  provides  employ- 
ment for  as  many  laborers,  as  if,  by  means  of  the  philosopher's 
stone,  he  had  created  an  amount  of  gold  equal  to  the  amount  of 
notes  permanently  maintained  by  him  in  circulation.  It  is  this 
feature  of  our  banking  system  that  has  been  most  frequently  as- 
sailed. It  has  been  called  a  system  of  fictitious  credit,  raising  the 
wind,  a  system  of  bubbles.  If  it  be  a  fictitious  system,  its  effects 
are  not  fictitious  ;  for  it  leads  to  the  feeding,  clothing,  and  employ- 
ment of  a  numerous  population.  If  it  be  a  raising  of  the  Avind,  it 
is  the  wind  of  commerce,  that  bears  to  distant  markets  the  products 
of  our  soil,  and  wafts   to  our  shores   the  productions   of  every 


248  PAPER-MONEV    AXD    BANKING. 

climate.  If  it  he  a  system  of  bubbles,  they  are  bubbles  which, 
like  those  of  steam,  move  the  mighty  engines  that  promote  a 
nation's  irreatness,  and  a  nation's  wealth. 

"  Thus  a  banker,  in  three  ways,  increases  the  productive  power 
of  capital.  First,  he  economizes  the  capital  already  in  a  state  of 
employment.  Secondly,  by  the  system  of  deposites,  he  gives  em- 
ployment to  capital,  that  was  previously  unproductive.  Thirdly, 
by  the  issue  of  his  own  notes,  he  virtually  creates  capital  by  the 
substitution  of  credit.  The  means  which  a  banker  possesses  of 
granting  facilities  to  trade  and  commerce,  will  be  in  proportion  to 
the  amount  of  these  three  sources  of  capital.  If  his  own  capital 
amounts  to  .£100,000,  and  the  deposites  in  his  hand  to  =£100,000, 
and  his  notes  in  circulation  to  .£100,000,  he  has  then  at  his 
command  the  sum  of  £300,000,  with  which  he  may  discount  bills 
to  his  customers.  But  if  the  public  say  to  him,  we  will  take  your 
notes  no  longer,  give  us  gold,  he  will  issue  gold,  but  he  must  re- 
duce his  discounts  from  £300,000  to  £1^00,000.  If  the  depositors 
also  demand  the  return  of  their  deposites,  he  must  reduce  his  dis- 
counts from  £200,000  to  £100,000,  the  sum  raised  by  deposites 
being  again  rendered  unproductive  in  the  hands  of  the  owners,  and 
that  raised  by  the  circulation  of  notes  being  altogether  annihilated. 

"Banking  promotes  the  prosperity  of  a  country,  chiefly  by  in- 
creasing the  amount  and  efficiency  of  its  capital.  In  the  history  of 
commerce,  we  find  no  p;  inciple  more  firmly  established  than  this  : 
that,  as  the  capital  of  a  country  is  increased,  agriculture,  manufac- 
tures, commerce,  and  industry,  will  flourish  ;  and  when  capital  is 
diminished,  these  will  decline.  The  man  who  attempts  to  annihi- 
late any  portion  of  the  capital  of  the  country  in  which  he  dwells,  is 
as  foro-etful  of  his  own  advantage  as  the  miller  who  should  en- 
deavor  to  dry  up  the  mountain-stream  which  turns  the  wheels  of 
his  machinery,  or  the  farmer  who  should  desire  to  intercept  the 
sun  and  the  showers  which  fertilize  his  fields." 

Adam  Smith  was  clearly  of  opinion,  that  pnper-money  aug- 
mented trade  and  commerce.  He  says  :  "  When  paper  is  sub- 
stituted in  the  room  of  gold  and  silver  money,  the  quantity  of  the 
materials,  tools,  and  maintenance,  which  the  whole  circulating  capital 
can  supply,  may  be  increased  by  the  whole  value  of  gold  and  silver 
which  used  to  be  employed  in  circulating  them.  The  whole 
value  of  the  great  wheel  of  circulation  and  distribution,  is  added 
to  the  goods  which  are  circulated  and  distributed  by  means  of  it. 
.  .  I  have  heard  it  asserted  that  the  trade  of  the  city  of  Glasgow 


PAPER-MONEY    AND    BANKING.  249 

doubled  in  about  fifteen  years  after  the  first  erection  of  the  banks 
there,  and  that  the  trade  of  Scotland  has  more  than  quadrupled 
since  the  first  erection  of  the  two  public  banks  at  Edinburgh."  It 
is  true  he  does  not  make  banks  the  sole  cause  of  this  increase  of 
trade :  thouirh  he  seems  to  think  it  the  crreatest. 

But  Adam  Smith  assumes,  that  a  paper  medium  banishes  from 
the  country  an  amount  of  the  precious  metals  equal  to  the  amount 
of  paper  in  use  ;  that  is,  as  we  suppose,  equal  to  the  excess  of 
paper  above  the  specie  deposites ;  and  that  this  specie,  thus  gone 
abroad,  is  employed  in  foreign  commerce,  as  capital  of  the  country, 
from  which  it  goes;  and  consequently,  that  the  external  trade  of 
that  country  is  enhanced  in  proportion  to  the  amount  of  specie  thus 
disengaged  from  domestic  uses.  There  might  have  been  some 
reason  for  this  theory,  in  Adam  Smith's  time  ;  and  it  may  still 
have  some  truth  in  it,  in  the  same  quarter..  But  the  great  error 
of  Adam  Smith  and  his  school,  is,  that  they  are  ever  deducing 
general  principles  from  isolated  facts,  and  insisting  on  their  appli- 
cation everywhere. 

Practically,  it  does  not  seem  probable,  that  paper-money  in  the 
United  States  ordinarily  has  the  effect  to  banish  the  precious 
metals,  to  any  considerable  extent,  if  at  all,  because  the  objects  of 
banking  here  are  rather  for  domestic  than  for  foreign  purposes. 
Money  will  of  course  be  employed  where  it  is  worth  most;  and  it 
has  happened,  down  to  this  time,  to  have  been  always  worth  more 
in  the  United  States,  than  elsewhere,  since  we  have  been  a  nation. 
The  American  banking  system  was  not  established  solely,  nor 
chiefly,  for  economy  in  the  machinery  of  the  circulating  medium 
—  which  is  the  reason  assigned  by  Adam  Smith  —  but  its  main 
design  is  to  supply  a  defect  of  that  medium.  This  being  the 
principal  object,  there  is  no  natural  reason  why  the  existence  of  a 
paper  medium  should  banish  the  precious  metals,  although,  to 
some  extent,  their  absence  might,  perhaps,  better  be  afforded. 
But,  so  far  as  they  are  withdrawn  from  circulation,  it  is  not  to 
employ  them  abroad,  but  to  hold  them  in  deposite,  in  the  bank 
vaults,  as  a  basis  of  the  paper  medium.  A  balance  of  trade  against 
the  country,  that  happens  for  want  of  an  adequate  protective  sys- 
tem, may  tend  to  draw  them  off,  and  will  naturally  do  so.  But 
they  ought  not  to  be  liable  to  such  a  draft,  nor  does  it  enter  into 
the  design  of  the  American  banking  system,  that  they  should  go 
abroad.  When  they  begin  to  go,  through  the  influence  of  the 
above-named    cause,   it  is   a   just   subject  of  concern,   and   will 


k 


250  PAPER-MONEY    AND    BANKING. 

naturally  be  the  occasion  of  what  is  called  bank  contraction,  which, 
if  the  draft  continues,  under  large  foreign  demands,  is  liable  to  end 
in  bank  suspension. 

The  principle,  therefore,  laid  down  by  Adam  Smith,  is  im- 
properly asserted  by  him  to  be  a  general  one.  Certainly  it  does 
not  apply  to  the  American  System.  This  only  proves  what  we 
have  occasion  to  maintain  throughout  this  work,  that,  although 
some  of  the  principles  of  every  system  of  public  economy,  may 
be  and  are  common  to  all  systems,  there  can  be  no  common  sys- 
tem equally  applicable  to  all  nations,  or  to  any  two  nations.  Every 
nation  —  and  none  more  than  the  United  States  —  is  obliged  to 
legislate  on  some  principles,  vitally,  radically,  and  fundamentally 
different  from  some  of  those  which  are  equally  important  to  other 
nations. 

It  will  be  seen  from  what  has  been  advanced  in  this  and  in  the 
three  preceding  chapters,  that  we  do  not  consider  it  possible  to 
base  a  circulating  medium  on  anything  but  the  precious  metals. 
Nevertheless,  it  would  seem,  that  the  world  has  not  even  yet  done 
with  trying  other  modes,  or  at  least  advocating  other  principles. 
Lamartine,  who  has  been  put  forward  as  a  leading  statesman  in  the 
French  Republic  of  1848,  speaking  of  the  French  assignats,  in  his 
history  of  the  Girondists,  says,  "Une  monnaie  n'a  jamais  d'autre 
valeur  que  celle  de  la  convention  qui  I'a  cree.  .  .  La  loi  seule 
pent  frapper  monnaie.  .  .  Comment  I'etat  qui  represente  la  fortune 
et  le  credit  de  tons,  ne  frapperait-il  pas  une  monnaie  du  papier  aussi 
inviolable  et  aussi  accreditee,  que  celle  de  simples  citoyens?" 
He  maintains  that  the  want  of  credit  in  the  assignats  was  a  mere 
fatuity,  the  result  of  popular  caprice  and  habit;  and  as  above,  that 
law  can  make  money  at  any  time.  This  power  would  certainly 
be  a  great  convenience  to  the  French  republic,  in  its  present  em- 
barrassed finances,  one  month  after  its  birth. 

The  celebrated  En2;lishman,  Law,  who  once  had  so  much  in- 
fluence  on  this  question  in  France,  maintained,  that  money  ought 
not  to  have  any  intrinsic  value  ;  and  the  whole  English  nation,  states- 
men, economists,  and  all,  with  a  few  exceptions,  were  led  entirely 
astray,  by  a  supposed  state  necessity,  during  the  suspension  of  the 
bank  of  England,  from  1797,  running  on  for  about  a  quarter  of  a 
century.  It  is  true  that  a  committee  of  the  house  of  commons,  in 
1809,  brought  in  an  orthodox  report,  to  wit,  that  gold  had  not 
risen,  but  that  the  paper  of  the  bank  of  England  had  depreciated; 
but  the  house,  for  state  purposes,  Instantly  reversed  this  decision, 


PAPER-MONEY    AND    BANKING.  251 

to  maintain  the  credit  of  the  bank.  They  doubtless  voted  against 
their  convictions  and  their  conscience,  thinking  that  the  state  of  the 
kingdom  required  it;  and  to  this  day  the  economists  and  statesmen 
of  Great  Britain  have  scarcely  emerged  from  the  obscurity  into 
which  they  were  then  plunged.  Observe  what  M.  Say  puts  forth, 
and  into  what  an  error  he  was  led,  in  view  of  this  very  spectacle, 
to  wit,  the  suspension  of  the  bank  of  England: — 

"  The  very  singular  state  of  the  actual  money  of  England,  and 
the  extraordinary  circumstances  that  have  occurred  in  respect  to 
it,  have  given  a  decisive  proof,  that  the  mere  want  of  an  agent  of 
circulation,  or,  of  the  commodity,  money,  is  sufficient  to  support  a 
paper-money,  absolutely  destitute  of  security  for  its  convertibility, 
at  a  high  rate  of  value  or  even  at  a  par  with  metal,  provided  it  be 
limited  in  amount  to  the  actual  demand  of  circulation.  .  .  Sixty 
millions  of  paper  [English  bank  paper],  though  destitute  of  in- 
trinsic value,  are,  by  the  mere  want  of  a  medium  of  exchange, 
made  equal  to  1,284,000  lbs.  weight  of  gold,  or  1,200,000,000 
lbs.  weight  of  sugar." 

"  Ricardo,"  says  M.  Say,  "  whom  I  look  upon  as  the  individual 
in  Europe  the  best  acquainted  with  the  subject  of  money,  both  in 
theory  and  in  practice,  has  shown,  in  his  proposal  for  an  eco- 
nomical and  secure  currency,  that,  when  the  good  government  of 
the  state  may  be  safely  reckoned  upon,  paper  may  be  substituted 
for  the  whole  of  a  metallic  money." 

But  hear  Ricardo  himself,  in  view  of  the  same  state  of  things : 
"  It  is  not  necessary  that  paper-money  should  be  payable  in  specie, 
to  secure  its  value  ;  it  is  only  necessary  that  its  quantity  should  be 
reo;ulated  accordino;  to  the  value  of  the  metal  which  is  declared  to 
be  the  standard." 

As  the  government  had  authorized  the  suspension  of  the  bank 
of  England,  decreed  that  gold  had  risen,  and  that  bank-paper  had 
not  fallen,  the  public  creditor,  in  1810,  was  obliged  to  take  bank- 
of-England  paper  at  par,  when  £56  in  paper  would  purchase  only 
^46  14s.  6s.  in  gold  ;  that  is,  he  was  defrauded  of  1^  ounces  of 
gold  in  every  12  ounces,  the  latter  of  which  was  his  due. 

But  Great  Britain  which,  by  an  assumed  state  necessity,  had 
been  led  so  far  astray  in  her  doctrines  regarding  a  monetary  system, 
during  the  long  suspension  of  the  bank  of  England,  has  been  com- 
pelled to  abandon  that  ground,  and  by  Sir  Robert  Peel's  bill  of  1844, 
after  having  been  so  long  driven  about  by  delusive  theories,  landed 
at  last  on  the  true  cash  or  metallic  platform.     This  bill  is  described 


252  PAPER-MONEY    AND    BANKING. 

by  Professor  Twiss  as  follows  :  "  The  bank  charter  act  [Sir  Robert 
Peel's,  1S44]  provided,  that  there  should  be  an  absolute  limit  to 
the  amount  of  notes  issued  upon  securities,  such  an  amount  being 
taken  as  would  keep  the  currency  at  par  with  foreign  countries, 
accordin*'-  to  past  experience.  It  combined  a  further  provision  for 
an  expansion  of  the  currency  to  suit  the  convenience  of  commerce, 
upon  a  basis  that  should  preclude  the  depreciation  of  it;  namely, 
by  allowing  an  unlimited  issue  of  notes  upon  bullion."  But,  pity 
to  say,  in  1S47,  another  assumed  state  necessity  compelled  a 
temporary  suspension  of  this  salutary  measure. 

Nevertheless,  the  world  now  generally  understands  and  believes, 
that  nothing  but  a  basis  composed  of  the  precious  metals,  exchange- 
able on  demand,  will  sustain  a  circulating  medium  in  full  credit.  It 
4s  remarkable,  however,  that  the  economists  and  statesmen  of  Great 
Britain  are  behind  all  the  rest  of  the  world  in  this  particular,  proba- 
bly on  account  of  the  residuary  influence  of  the  doctrine  decreed  by 
British  statesmen,  to  answer  the  supposed  necessities  of  the  empire 
durino-  the  long  suspension  of  the  bank  of  England.  They  evi- 
dently waver,  and  look  upon  Sir  Robert  Peel's  bill  of  1844  as  a 
problem.  Professor  Twiss  so  regards  it.  Another  imaginary  state- 
necessity  may  possibly  bring  them  back  to  the  same  old  ground 
again.'  For  the  state  must  be  maintained  at  all  hazards,  and  by 
any  expedients  whatever.  . 

It  was  a  mistake,  however,  to  suppose  that  an  expedient  of  this 
kind  sustained  the  credit  of  the  bank-of-England  notes.  The  de- 
cree of  parliament  had  not  an  item  of  influence  in  this  particular. 
It  cheated  nobody  but  the  public  creditor,  by  forcing  him  to  take 
lOi  ounces  of  gold  for  12.  All  who  traded  in  money  at  that 
period  estimated  the  comparative  values  of  gold  and  of  bank-of- 
England  notes,  by  the  same  rules  which  determine  all  commercial 
values,  and  dealt  in  them  accordingly.  The  same  rules  governed 
those  who  exchanged  money  for  other  commodities,  and  other  com- 
modities for  money.  Gold  in  all  such  cases  bore  a  premium  of 
the  diff"erence  between  itself  and  bank-of-England  notes.  The 
public  creditor  suffered  alone. 

Such  is  always  the  result  in  all  cases  of  bank  suspension.  The 
notes  go  immediately  into  market,  and  the  market  price,  as  esti- 
mated by  the  precjous  metals  in  the  scales,  determines  their  value. 
That  the  bank-of-England  notes  did  not  fall  lower  than  90  on  a 
100  durino-  the  long  suspension,  prove  simply  and  that  conclusively, 
that,  in  the  market,  there  were  90  grains  of  faith  to  10  grains  of 


A    GOVERNMENT-BANK.  253 

diffidence,  as  to  the  probability  of  redemption  in  cash.  Such  is 
the  invariable  law  applied  to  uncurrent  or  irredeemable  money 
when  exchanged  for  specie.  The  suspension  of  a  bank  does  not 
prove  it  insolvent.  It  maybe  perfectly  sound.  But  it  impairs  its 
credit,  and  depreciates  its  paper  precisely  by  the  measure  of  con- 
fidence it  has  lost.  The  precious  metals  never  rise  or  fall  in  price 
except  in  their  values  for  use,  either  as  money  or  for  other  pur- 
poses ;  and  the  scales  are  their  only  measure.  And  the  price  of 
gold  and  silver,  or  of  any  money  for  use,  as  before  shown,  is  not 
the  entire  sum,  but  the  3,  or  5,  or  JO,  or  any  other  per  cent,  given 
for  such  use  ;  whereas,  when  money  is  exchanged  for  other  com- 
modities, in  other  words,  is  discharging  the  proper  functions  of 
money,  not  as  the  subject  but  as  the  instrument  of  trade,  then  the 
entire  sum  is  the  price. 

Banking  by  government  is  liable  to  several  very  manifest  evils 
and  perils,  one  of  the  most  prominent  of  which  —  especially  in  a 
republican  community,  where  public  officers  are  frequently  changed, 
and  scarcely  ever  selected  for  their  financial  abilities  —  is,  that  the 
government,  even  if  qtialified  by  a  knowledge  of  the  subject,  has 
enough  else  to  do,  and  can  not  do  justice  to  this.  The  history  of 
banking  in  all  countries,  not  less  than  the  first  glance  of  so  difficult 
a  business,  teaches  that  it  requires  the  undivided  attention  of  those 
who  have  it  in  hand.  'J'o  be  duly  qualified,  a  man  should  be  ed- 
ucated, trained  to  it,  by  long  service  in  its  practical  operations,  as 
an  apprenticeship.  The  greatest  hazard  of  all  for  a  government 
to  set  up  banking,  in  its  own  proper  capacity,  is  the  temptation  to 
trade  in  the  public  credit.  Money-brokers  may  do  this  legitimately  ; 
but  that  the  government  itself  should  do  it,  in  banking,  as  a  part 
of  its  banking  capital,  is  one  of  the  most  alarming  features  of  the 
case.  After  all  the  experience  of  the  world,  it  ought  to  be  con- 
sidered as  a  setded  question,  that  no  paper  should  ever  be  au- 
thorized as  a  common  currency,  which  is  not  founded  on  a  specie 
basis,  and  which  is  not  redeemable  on  demand  by  specie. 

Take,  for  example,  the  Independent  or  Subtreasury,  in  connexion 
with  the  power  to  issue  treasury-notes,  which  vests  in  the  same  de- 
partment, and  which  can  not,  therefore,  be  separated  from  its  func- 
tions, and  it  is  a  bank,  with  every  faculty  of  banking  except  that 
of  discount,  which  is  not  essential  to  banking.  The  treasury  of 
the  United  States,  by  the  Subtreasury  law,  is  constituted  into  a 
bank,  and  the  authority  to  make  loans  and  issue  treasury-notes,  on 
no  other  foundation  than  credit,  is  merely  an  extension,  by  separate 


254  A    GOVERNMENT-BANK. 

acts,  from  time  to  time,  of  the  powers  of  the  same  institution  or 
ao-ency  ;  for  it  can  not  be  said  there  are  two  agencies  in  the  case, 
or  two  separate  responsibilites.  There  is  only  one.  Treasury- 
notes,  therefore,  as  a  part  of  the  action  of  such  an  institution,  are 
merely  another  name  for  the  post-notes  of  a  bank,  which  are  alvvnys 
objectionnble  in  a  banking  institution,  because  they  indicate  weak- 
ness, and  the  necessity  of  credit.  Let  this  bank  go  on,  and  issue 
its  post  (treasury)  notes,  from  year  to  year,  by  tens  or  twenties 
of  millions,  in  excess  of  its  specie  basis,  the  public  revenue; 
the  latter  decreasing  as  the  former  augments  ;  and  is  it  not  trading 
on  credit  in  banking  operations  ?  The  credit  of  the  United  States 
is  usually  good  —  always  when  the  public  finances  are  well  managed 
— but  it  is  never  beyond  the  reach  of  a  shock.  The  post  (treasury) 
notes  of  this  institution,  and  its  drafts,  are  liable  to  constitute  mil- 
lions of  the  circulating  medium  of  the  country,  and  to  present  the 
anomaly  of  a  currency  constantly  fluctuating  in  value.  Jt  is  never 
at  par,  except  in  travsitu  from  above  to  below,  or  from  below  to 
above.  And  whenever  this  government-bank  shall  hzve  ventured, 
in  its  trade  on  credit,  to  the  breaking  down  of  its  credit — which  is 
a  supposable,  possible,  and  perhaps  not  improbable  case  —  where 
and  what  will  this  currency  then  be  ?  The  perfection  of  a  banking 
systern  is,  that  the  value  of  its  notes  to  the  holder  should  have  no 
other  cause  of  fluctuation  than  the  distance  they  may  have  travelled 
from  the  bank's  counter,  being  always  redeemable  there.  It  is  a 
remarkable  fact,  that  the  notes  of  the  old  bank  of  the  United 
States  did  not  depreciate  even  by  this  cause,  and  were  rarely  below 
par,  often  at  a  premium,  in  the  remotest  parts  of  the  world,  as  in 
China.  But  the  currency  of  the  present  (government)  bank,  that 
is,  of  the  United  States  treasury,  does  not  remain  at  the  same  rate 
of  value  scarcely  for  a  single  day,  simply  because  it  is  based  on 
credit,  which  lies  at  the  mercy  of  the  bulls  and  bears  of  the  stock 
market,  all  depending,  not  on  capital,  but  on  the  conduct  of  the 
ao'enry  of  the  bank  itself.  Public  credit,  in  its  own  proper  position, 
is  well  enough.  But  it  was  never  made  for  banking,  but  rather  for 
the  specidations  of  stock-jobbers,  whose  appropriate  field  it  is. 

But,  there  are  other  lights,  in  which,  for  the  practical  purposes 
of  the  commercial  world,  this  government-bank  claims  to  be  viewed. 
It  has  some  formidable  horns  of  power  upon  its  head.  It  can  not 
but  be  seen  that  seizing  upon  and  taking  in  charge  the  specie  of 
the  country,  by  withdrawing  it  from  the  vaults  of  the  state  banks  — 
there  being  no  other  but  these  —  and  locking  it  up  in  the  vaults  of 


RUBTREASURY.  255 

a  treasury-bank,  created  by  federal  legislation,  for  tbis  purpose,  is 
a  very  essential,  direct,  and  positive  interference  with  the  banking 
business  of  the  country,  inasmuch  as  gold  and  silver  are  the  only 
legitimate  basis  of  banking,  and  inasmuch  as  when  these  are  taken 
away,  all  the  power  of  banks  for  usefulness,  on  the  American 
system,  in  the  supply  of  a  currency,  is  broken  down.  In  such  a 
case  they  can  not  issue  to  the  extent  designed,  and  which  the  neces- 
sities of  the  public  may  require,  except  by  a  fraudulent  act.  It  is 
immaterial,  so  far  as  the  principle,  and  so  far  as  positive  mischief 
is  concerned  —  except  merely  in  the  amount  of  the  latter — whether 
this  effect  be  entirely  sweeping  and  comprehensive,  so  as  to  shut 
up  the  banks;  or  only  partial,  to  embarrass  their  operations,  and 
thereby  to  prevent  their  supply  of  an  adequate  currency  for  the 
business  and  trade  of  the  country.  It  is  certain,  that,  if  the  federal 
government  claim  and  exercise  the  right  of  drawing  into  its  vaults 
thirty  millions  of  specie  a  year,  in  a  time  of  peace,  and  fifty  or  a 
hundred  millions  in  a  time  of  war,  it  must  necessarily  have  nearly 
or  quite  an  entire  control  over  the  banking  institutions  of  the  coim- 
try,  to  contract  their  issues,  and  thus  to  embarrass  trade,  and  crip- 
ple the  connnercial  operations  of  the  people.  The  Subtreasnry  is 
compelled  to  rely  on  the  bank-vaults  for  its  supplies,  as  the  specie 
of  the  country  is  not  tangible  in  large  amounts  anywhere  else,  so 
that,  virtually,  and  in  every  practical  effect,  under  a  treasury-bank, 
of  this  description,  all  other  banks  subsist  for  its  accommodation, 
and  not  for  the  accommodation  of  the  business  public,  of  the  peo- 
ple, for  which  latter  purpose  they  were  undoubtedly  created.  In 
the  most  prosperous  times,  and  for  a  season,  both  may  go  on  to- 
gether without  great  inconvenience.  But  the  moment  there  is  a 
pinch,  the  Subtreasury  draws  on  the  banks,  and  the  banks  of  neces- 
sity curtail  their  credits  and  call  in  their  dues.  They  are  pinched 
by  the  Subtreasury,  and  all  engaged  in  trade  —  what  man,  rich  or 
poor,  has  not  an  interest  in  trade?  —  all  so  engaged  are  pinched  by 
the  banks,  not  as  a  first,  but  as  a  secondary  cause.  The  banks  are 
compelled  to  this  course  by  the  operation  of  the  Subtreasnry. 
Thus,  when  the  trade  of  the  country  wants  money  the  most,  it 
gets  it  the  least.  It  is  wrested  from  the  business  public  by  the  all- 
absorbing  Subtreasury  demands.  Instead  of  having  three  dollars 
of  currency  for  one  of  specie  in  the  bank-vaults,  as  is  usual  in 
prosperous  times,  the  business  public  can  only  have  one  dollar, 
when  they  want  three  more  than  they  ever  did.  They  are  pinched, 
they  are  distressed,  and  thousands  come  to  ruin  by  this  single  cause; 


256  A    GOVERNMENT-BANK. 

whereas,  if  the  banks  were  not  connpelled  to  refuse  discounts,  and 
to  call  in  their  debts,  by  the  action  of  the  Subtreasury,  they  would 
and  could  accommodate  the  business  public,  and,  peradventure, 
save  the  country  from  a  commercial  revulsion. 

Nor  is  it  a  sufficient  answer  to  say,  that  this  specie  all  comes 
back  again  from  the  Subtreasury,  by  the  disbursements  of  the  institu- 
tion. Some  of  it  may  come  back,  to  be  taken  out  again  in  the  same 
way  ;  but  it  will  not  accommodate  the  business  public,  which  com- 
prehends all  persons,  in  every  condition  of  life,  even  the  poo'^est, 
who  will  feel  a  pressure  of  this  kind  much  quicker  than  the  rich. 
Besides  that  the  secretary  of  the  United  States  treasury,  under  this 
law,  always  has  his  hand  on  the  banks,  and  is  ever  thrusting  it  into 
their  vaults,  he  has  continually  in  his  charge  and  under  his  control, 
a  sufficient  amount  of  specie  —  rarely,  if  ever,  less  than  millions, 
often  tens  of  millions  —  the  want  of  which,  as  a  basis  of  the  com- 
mon currency,  is  sufficient,  at  any  ordinary  time,  to  embarrass  trade 
and  cripple  commerce.  The  importation  of  specie,  in  large  amounts, 
from  Europe,  in  1846-'47,  in  consequence  of  short  crops  there, 
which  relieved  the  money-market  of  the  United  States,  and  enabled 
the  country  better  to  bear  the  operation  of  the  Subtreasury,  was  a 
providential  event  which,  in  the  case  of  good  crops  in  Europe,  can 
not  be  relied  upon.  Such  extraordinary  events  would  be  alike  an 
imprudent  basis  of  legislation,  as  of  confidence  for  the  future. 

What,  for  example,  will  be  the  state  of  things,  when  our  foreign 
exchanges  shall  be  reversed,  and  specie  begin  and  continue  to  flow 
out  of  the  country,  as  must,  sooner  or  later,  be  the  case?  Even 
under  this  extraordinary  influx  of  specie,  the  banks  were  obliged  to 
keep  an  eye  on  the  demands  of  the  Subtreasury,  rather  than  on  the 
wants  of  the  business  public.  They  could  not  in  prudence  enlarge 
their  issues,  by  extending  their  credits,  because  they  were  ever  lia- 
ble to  have  their  paper  presented  for  specie  by  the  agents  of  the 
government-bank,  who  were  continually  drawing  upon  them  by 
their  paper  already  out ;  so  that  the  people  were  not  only  barred 
from  getting  money,  as  they  might  want  for  business,  as  "tools"  of 
trade,  but  they  were  constantly  being  deprived  of  what  they  had. 

This  government  institution,  therefore,  thus  becomes  an  inter- 
fering power  with  the  banking  operations  of  the  country,  to  disturb 
and  embarrass  them,  and  to  hold  the  banks  in  such  a  constant  state 
of  uncertainty,  as  to  the  demands  that  may  be  made  upon  them  for 
specie,  that  they  really  exist,  under  such  a  system,  not  for  the  ac- 
commodation of  the  business  public,  for  which  they  were  designed  ; 


SUBTREASURY.  257 

but  for  the  accommodation  of  the  officers  and  for  the  uses  of  the 
federal  government,  for  which  they  were  not  designed.  The  effect 
is  to  subvert  the  banking  system,  to  disappoint  its  aims.  Thirty 
millions  of  specie,  in  a  time  of  peace,  and  sixty  millions  or  more  in 
time  of  war,  are  annually  drawn  into  the  vaults  of  the  Subtreasury, 
part  as  revenue,  and  part  as  loans  ;  and  the  vaults  of  the  banks  are 
the  only  places  where  this  specie  can  be  obtained.  Thus,  in  a  time 
of  scarcity  of  the  precious  metals,  the  banks  can  not  issue  money 
for  the  business  public  ;  for  if  they  do,  the  operation  of  the  iSub- 
treasury  might  at  any  moment  render  them  liable  to  drafts  on  their 
vaults,  so  as  to  force  them  to  suspend  ;  not  because  they  are  insol- 
vent, and  have  not  assets  for  all  demands  ;  but  because  there  is  a 
lack  of  specie  in  the  country.  To  avoid  this  result,  they  can  not, 
in  prudence,  at  a  time  of  money  pressure,  and  under  the  operation 
of  the  present  United  States  government-bank,  venture  on  issues 
of  paper  in  excess  of  their  specie  deposites  ;  nor  usually  even  to 
that  amount.  The  very  time  when  the  business  and  trade  of  the 
country  would  be  most  cramped,  and  even  distressed,  for  want  of 
money,  is  the  time  when  the  natural  operation  of  the  Subtreasury 
would  greatly  agQ;ravate  that  distress.  For  example,  there  was 
not  specie  enough  in  all  the  banks  of  the  country,  that  could  pos- 
sibly have  been  spared,  to  answer  the  necessities  of  the  government 
in  1847,  independent  of  the  extraordinary  importations  from  Eu- 
rope, for  the  reason  above  named  ;  and  it  is  as  certain,  as  figures 
can  make  it,  that,  if  Providence  had  not  smitten  Europe  with  famine, 
we  should  have  been  smitten,  by  the  operation  of  the  Subtreasury, 
in  1847,  with  a  widespread  bankruptcy,  from  the  effects  of  which 
the  government  itself  could  not  have  escaped. 

But  a  mere  subversion  of  the  banking  system,  by  such  a  meas- 
ure, is  not  the  worst  effect.  It  becomes  a  positive  tax,  a  heavy 
burden  to  the  people,  in  many  respects.  It  is  a  tax  in  reducing 
and  rendering  insufficient  the  circulating  medium.  A  thing  that 
is  not,  and  never  has  been,  can  not  be  exactly  measured.  A  man 
may  know  and  feel,  that  he  has  been  deprived  of  a  great  contingent 
benefit,  by  being  deprived  of  the  means  of  acquiring  it,  though  he 
may  be  unable  to  estimate  exactly  the  amount  of  his  loss.  But  if 
it  were  a  benefit  to  which  he  was  entitled,  and  being  robbed  of  it, 
the  deprivation  is  a  tax,  unjustly  impored,  to  the  amount  or  value 
thereof,  whatever  that  may  he.  In  this  way,  all  the  contingent 
wealth  of  which  the  people  of  the  United  States  may  at  any  time 
be  deprived,  by  the  operation  of  the  Subtreasury,  in  subverting  the 

17 


258  A    GOVERNMENT-BANK. 

banking  system  of  the  country,  reducing  the  circulating  medium 
when  it  is  most  wanted,  embarrassing  trade,  and  circumventing 
commerce,  is  a  tax  —  and  a  tax,  which,  if  it  could  be  told,  would 
be  startling.  But  the  positive  expenses  of  the  machiner\-  of  this 
treasury-bank  are  more  palpable,  and  constitute  no  inconsiderable 
tax-  To  this  should  be  added  the  risk  and  cost  of  transporting 
specie  from  one  point  to  another,  examples  of  which  are  presented 
on  page  244. 

But  the  people  may  well  ask,  why  should  the  federal  govern- 
ment have  this  power?  Is  not  the  currency,  which  is  good  enough 
for  us,  good  enough  for  them?  What  is  this  government  of  the 
United  States?  Is  it  not  flesh  and  blood,  as  we  are?  Does  it  not 
eat,  drink,  wear  clothes,  and  live  in  houses,  as  we  do  ?  Are  not 
its  wants  the  same  as  ours,  and  will  not  the  same  things  satisfy  them  ? 

This,  indeed,  is  rather  a  singular  spectacle  presented  by  the  peo- 
ple and  government  of  the  United  States,  in  their  relations  to  each 
other.  It  might  well  be  said,  if  the  currency  of  the  country  was 
good,  why  was  it  not  good  enough  for  the  government?  And  if  it 
was  not  good,  what  reason  can  be  given,  why  the  government  should 
be  better  served  than  the  people,  all  at  the  expense  of  the  people? 

But  there  is  something  more  in  this  treasury-bank,  than  an  inter- 
ference with,  and  a  subversion  of  the  banking  system  of  the  coun- 
trv,  in  the  manner  and  to  the  effect  above  described  —  somethincr 
more  than  the  tax  of  supporting  it.  There  seems  to  be  an  instinct 
in  the  federal  government,  which  teaches  it,  that  it  can  not  be  dis- 
vorced  from  banks.  It  has,  therefore,  stolen  one  of  the  worst  kind, 
and  set  it  up  in  a  shape  to  have  it  pass  for  a  No-bank.  It  was  made 
by  those  who  had  unmade  the  old  bank,  and  being  professedly  com- 
mitted to  a  NO-bank  system,  yet  finding  they  could  not  do  without  a 
bank,  they  were  forced  to  get  up  an  anomalous  institution.  But  it  is 
a  bank,  as  we  have  seen  —  a  government-bank  —  a  bank  of  deposite, 
and  a  bank  of  issues.  Certainly  it  is  a  bank  of  deposite ;  and  that  it  is 
a  bank  of  issues,  look  at  its  paper,  going  the  rounds  of  the  country 
to  the  amount  of  tens  of  millions,  as  a  currency.  Is  not  that  a  bank? 
It  would  seem,  that  the  federal  government  can  not,  by  any  possibil- 
ity, keep  its  hands  off  of  banking ;  and  that,  when  it  professes  not 
to  have  one,  it  gets  one  with  a  vengeance.  An  open  and  frank 
assertion  of  the  right  of  banking,  as  derived  from  the  constitution, 
would  be,  not  only  more  honorable,  but  more  safe,  than  to  disclaim 
it  with  the  breath  of  the  mouth,  and  usurp  it  with  the  hand  of  power. 

Besides  the  commercial  evils  of  the  Subtreasury  bank,  monopo- 


SUBTREASURY.  259 

lizing  the  precious  metals,  in  a  time  of  scarcity,  as  already  indica- 
ted, there  are  no  limits  to  the  political  power  of  such  an  institution, 
in  the  hands  of  the  national  executive,  to  subvert  the  liberties  of  the 
country.  It  is  a  union  of  purse  and  sword,  such  as  was  never  even 
dreamed  of  by  the  most  sagacious  vaticinations  of  the  far-seeing 
framers  of  the  government.  It  is  a  power  not  only  to  control  the 
currency,  while  professing  to  have  nothing  to  do  with  it,  but  to  draw 
into  its  hands  all  the  gold  and  silver  of  the  country,  to  pass  through, 
only  in  such  a  way,  and  for  such  purposes,  as  may  please  those 
who  have  charge  of  it.  It  is  absolute  power,  and  may  be  used  at 
will.  If  it  does  not,  at  some  future  day,  perpetuate  the  will  of  one 
man,  and  impose  it  on  the  country,  for  ages,  perhaps  for  ever,  it  cer- 
tainly will  not  be  for  want  of  ability,  with  such  an  engine  of  power 
in  his  hands. 

With  the  evidence  which  we  now  have  of  the  tolerable  adequacy 
of  the  state  banks  to  furnish  a  currency,  there  could  be  no  urgent 
necessity  for  the  re-establishment  of  a  national  bank,  unless  the 
state  of  things  brought  about  by  the  operation  of  the  Subtreasury 
system,  should  create  that  necessity  in  its  abrogation.  That  the 
state-bank  system  will  be  materially  unhinged,  and  its  operation 
more  or  less  deranged,  by  the  Subtreasury,  can  not  but  be  certain. 
The  federal  government,  by  this  measure,  has  resumed  the  powers 
of  banking  with  a  stronger  hand  than  ever,  and  instead  of  doing  it 
by  proxy,  through  a  corporation  with  limited  powers,  it  has  taken 
the  business  into  its  own  charge,  with  unhmited  powers,  and  made 
a  treasury-bank.  In  falling  back  from  this  high-handed  measure, 
it  may  be  a  question,  as  to  where  will  be  the  best  stopping-place, 
and  whether  the  state  banks,  after  such  a  derangement,  will  be  fully 
competent,  and  well  fitted,  to  discharge  the  functions  which  they 
might,  perh^5s,  otherwise  have  done.  It  is  an  instinctive  quality, 
and  a  natural  right,  in  every  nation,  to  regulate  its  own  currency, 
by  the  national  authorities,  and  it  may  well  be  doubted,  whether  it 
can  ever  be  properly  done,  without  such  an  elevated  supervision. 
The  return  of  the  federal  government  to  banking,  in  the  Subtreasury 
mode,  is  proof  of  its  propensity  that  way;  and  when  the  Subtreasury 
can  no  longer  be  endured,  lo  remedy  the  evils  which  it  shall  have 
created,  it  may  possibly  be  found  necessary  to  readopt  the  usual 
mode  of  all  nations,  which  has  been  approved  by  universal  experi- 
ence. Certainly,  it  will  never  be  pretended  by  those  who  have 
made  the  treasury-bank,  that  there  is  no  banking  power  in  the  fed- 
eral constitution. 


260     m'culloch's  theory  of  tue  increase  of  capital. 


CHAPTER   XVII. 

THE    GAIN    OF    INDIVIDUALS    NOT    ALWAYS    THE    GAIN    OF    THE 

COMMUNITY. 

Views  of  Free-Trade  Economists  on  this  Point. — M'Culloch's  View  of  Capital  as  formed 
out  of  Profits. — MCuUoch's  Hobby. — The  Doctrine  of  Equivalents  in  Trade  considered. 
— Equivalents  in  Kind. — Money,  as  "  Tools  of  Trade,"  not  an  Equivalent  in  Kind. — How 
this  aftects  the  Doctrine  of  Free  Trade. — Difference,  economically,  between  Importations 
for  Consumption  of  Value,  and  Importations  to  be  improved  in  Value  or  otherwi.se  used 
for  Increase  of  Wealth. — The  Values  added  to  the  raw  Material  by  mannfacturins. — 
Every  Commercial  Transaction  independent. — Answer  to  some  Points  made  by  M.  Say. 

The  Free-Trade  economists  aver,  that,  as  the  wealth  of  a  na- 
tion is  composed  of  the  aggregate  wealth  of  all  the  individuals  in 
it,  whatever  an  individual  gains,  the  nation  gains.  We  propose  to 
show  that  this  rule  is  often  false. 

M'Culloch  has  well  and  truly  shown,  that,  as  a  general  rule,  the 
profits  of  producers  of  value,  are  the  measure  of  increasing  wealth, 
as  follows : — 

"  That  capital  is  formed  out  of  profit,  and  that  profit  is  itself  the 
surplus  obtained  from  industrious  undertakings,  after  the  produce 
expended  in  the  carrying  them  on  has  been  fully  replaced,  is  a  prop- 
osition, which,  though  universally  true,  is  at  variance  with  the  com- 
mon notions  on  the  subject.  Instead  of  supposing  profits  to  origi- 
nate in  the  manner  now  stated,  they  are  almost  uniformly  supposed 
to  depend  on  the  sale  of  the  produce,  and  to  be  made  at  the  ex- 
pense of  the  purchaser.  Thus,  to  take  a  familiar  instance,  the  hat- 
maker  who  sells  a  hat  for  thirty  shillings,  which  costs  film  twenty- 
five  shillings  outlay,  believes  himself,  and  is  universally  believed 
by  others,  to  have  made  the  five  shillings  of  profit  at  the  expense 
of  the  individual  who  bought  the  hat.  In  truth  and  reality,  how- 
ever, he  has  done  no  such  thing.  He  produced,  in  a  given  time, 
a  hat  equivalent  to  or  worth,  in  silver,  thirty  shillings,  while  the 
various  expenses  necessarily  incurred  in  its  manufacture,  only 
amounted  to  twenty-five  shillings.  But,  then,  it  must  be  borne  in 
mind,  that,  speaking  generally,  the  various  individuals  who  deal 
with  the  hat-makers,  are  placed  in  the  same  situation :  the  farmer, 
the  clothier,  the  boot-maker,  &c.,  are  all  making  the  same  profits, 
in  their  respective  businesses ;  or,  in  other  words,  they  are  all  pro- 


m'culloch's  theory  of  the  increase  of  capital.     261 

ducing  quantities  of  corn,  cloth,  boots,  &c.,  equal  to  thirty  shillings, 
by  an  outlay  of  twenty-five  shillings.  It  is  clear,  therefore,  that,  in 
exchanging  the  precious  metals  for  accommodation,  or  in  exchan- 
ging one  sort  of  commodities  for  another,  the  one  party  gains  noth- 
ing at  the  expense  of  the  other.  Profit  is,  in  all  cases,  the  result 
of  more  being  produced  in  a  given  period,  than  has  been  consumed 
in  that  period.  The  introduction  of  exchanges  would  not  be  ad- 
vantageous, if  it  merely  enabled  one  set  of  individuals  to  prey  upon 
some  other  set.  This,  however,  is  not  the  effect.  By  enabling  la- 
bor to  be  divided,  it  gives  individuals  the  means  of  employing  them- 
selves, in  preference,  in  some  one  pursuit,  and  consequently  causes 
commodities  to  be  produced  and  distributed  in  the  best  and  cheap- 
est manner;  but  it  does  nothing  more. 

"  If  the  popular  opinion  with  respect  to  the  source  of  profits, 
were  well  founded,  it  uouid  inevitably  follow  —  inasmuch  as  they 
take  for  granted  that  all  producers  make  their  profits  at  the  expense 
®f  some  one  else  who  buys  their  commodities — not  only  that  no 
additions  could  be  made  to  capital,  but  that  the  capital  now  in  the 
world  would  be  very  soon  annihilated.  If  such  were  really  a  cor- 
rect view  of  the  circumstances  under  which  mankind  are  placed, 
our  lot  would  be  anything  but  enviable.  Happily,  however,  this 
is  not  our  situation.  The  produce  of  the  labor  we  €xert,  during 
any  given  time,  is  a'lmost  always  greater  than  the  produce  we  are 
obliged  to  consume  during  the  same  time,  and  the  surplus  or  profit 
being  accumulated,  becomes,  in  its  turn,  an  instrument  of  vast 
power,  and  adds  prodigiously  to  the  productiveness  of  industry. 

"  It  is  clear,  therefore,  that  there  is  no  class  of  industrious  indi- 
viduals who  liv«  at  the  expense  of  any  other  class.  The  retail 
(dealer,  for  example,  is  in  no  respect  more  indebted  to  his  customers, 
than  they  are  to  him.  it  is  not  his,  but  their  own,  interest  that  they 
have  in  view,  when  they  resort  to  his  shop.  Society  is,  in  truth, 
as  M.  Destutt  Tracy  has  remarked,  nothing  but  a  continued  series 
of  exchans^es." 

As  a  general  rule,  or,  as  M'Culloch  himself  says,  in  the  above 
citation,  "generally  speaking,"  and  as  the  development  of  a  princi- 
ple, not  unimportant,  but  often  useful  in  application,  this  reasoning 
is  excellent,  and  tiie  doctrine  sound.  It  shows  bow  wealth  in- 
creases, and  the  only  way  in  wbich  it  can  increase,  in  direct  oppo- 
sition to  first-sig'ht  notions  or  popular  opinion.  But  Mr.  M'Culloch 
as  always  so  anxious  to  draw  everything  into  the  vortex  of  his  Free- 
Trade  theory,  that  be  is  rarely  contented  to  let  weJl  alone.     In  all 


262  EQUIVALExNTS    IN    EXCHANGES. 

his  wrilinTs,  on  every  topic,  in  a  dictionary  of  commerce,  or  what- 
ever he  is  about,  he  is  sure  to  be  seen  on  this  hobby.  It  seems  to 
be  a  mental  disease  with  him.  He  could  not  even  finish  the  above 
excellent  argument,  without  winding  up  with  the  absurdity,  that 
"  full  equivalents  are  always  given  for  whatever  is  received  in  ex- 
clianoes."  It  was  because  he  had  his  eye  on  trade  between  na- 
tions,  and  was  afraid,  either  that  this  principle  of  equivalents  in 
exclianges  would  be  forgotten  in  that  application  ;  or  that  some 
one  would  presume  to  think  or  say,  that  it  does  not  apply  there ; 
or  because  he  thought  proper  to  anticipate  the  application.  We, 
certainly,  shall  have  no  controversy  with  Mr.  M'Culloch,  or  any 
one  else,  for  all  that  this  principle  is  worth  to  them,  in  either  do- 
mestic or  foreign  exchanges.  We  will  concede  to  them  the  prin- 
ciple beforehand,  for  the  sake  of  argument,  and  give  them  all  the 
advantage  of  it,  though  we  do  not  believe  in  it.  We  grant,  then, 
that  "full  equivalents"  are  rendered,  from  side  to  side,  in  exchanges 
between  nations.  The  question  at  issue  between  Free  Trade  and 
a  Protective  System,  does  not  fall  within  the  scope  of  this  proposi- 
tion ;  but  it  lies  in  the  kinds  of  equivalents  passed,  and  in  the  rela- 
tive proportions  of  the  kind  called  money. 

But  let  us  see  whether  these  exact  equivalents,  asserted  by  Mr. 
M'Culloch,  with  so  much  concern  about  another  question  not  in- 
volved in  this  after  all,  are  exactly  true.  It  is  not,  perliaps,  very 
material  for  the  augmentation  of  general  capital,  whether  bargains 
are  always  equal  or  not;  but  unequal  bargains  are  so  common,  that 
most  persons  will  very  readily  believe,  that  they  constitute  the  great 
majority.  But  except  as  they  afford  those  who  get  the  best  bar- 
gains an  undue  advantage  over  those  who  have  the  poorest,  and 
impair  the  position  of  the  latter  most  essential  to  public  wealth,  it 
is  not  easy  to  see  why  the  principle  of  Mr.  M'Culloch,  so  well  elu- 
cidated above,  so  far  as  the  general  augmentation  of  capital  is  con- 
cerned, does  not  apply  to  unequal  as  well  as  to  equal  bargains.  The 
design  of  trade,  doubtless,  is  the  exchange  of  equivalents,  though 
it  rarely  happens  with  perfect  exactitude.  No  matter.  Where  it 
is  not  a  cheat,  both  parties  are  accommodated,  obtain  a  pro6t,  and 
general  wealth  is  enhanced. 

It  makes  no  difference  to  the  nation,  in  domestic  trade,  when 
one  party  gives  money  in  exchange.  It  is  supposed  that  he  ob- 
tained the  money  by  some  other  commodity  sold  at  a  profit  on  the 
cost  of  production,  and  the  profit  is  a  fraction  of  the  money  paid  in 
such  a  case.     In  the  rounds  of  domestic  trade,  therefore,  though 


EQUIVALENTS    IN    EXCHANGES.  263 

exact  equivalents  are  rarely  exchanged,  Mr.  M'Culloch's  principle 
of  increase  of  wealth  by  exchange,  holds  good.  But  his  eagerness 
to  anticipate  and  decide  another  question,  enticed  him  into  the  fault 
of  asserting  what  every  one  knows  is  not  true,  viz.,  exact  equiva- 
lents in  exchani);es. 

Nor  will  we,  as  before  intimated,  insist  on  Mr.  M'Culloch's  giv- 
ing up  what  he  has  seized  upon  without  righi,  truth,  or  logic,  even 
in  application  to  foreign  exchanges.  Let  him  have  it.  We  grant 
him  that  equivalents  are  exchanged  in  foreign  trade,  as  long  as  it 
can  honestly  be  carried  on.  When  bankruptcy  or  suspension 
comes,  of  course  the  equivalents  are  suspended. 

The  question  between  us  and  the  Free-Tr"ade  economists.  Is, 
about  equivalents  in  kind.  If  they  will  be  content  to  let  us  pay 
in  kind,  that  is  all  we  want.  They  reply,  that  they  will  allow  us 
this  privilege  ;  but  they  say,  at  the  same  time,  that  money  is  an 
article  in  kind  ;  that  it  is  one  of  the  commodities  in  trade,  and  oc- 
cupies the  same  position  as  others  ;  and  that  it  makes  no  difference 
with  us  as  a  nation,  whether  we  pay  money  or  corn.  They  say 
we  get  an  equivalent,  which  we  do  not  deny  ;  but  we  say  it  will 
be  to  our  inconvenience,  if  we  exchange  our  "  tools  of  trade,"  so 
that  we  can  not  tradfi  any  more.  Here  is  the  point.  They  say, 
that  money  is  nothing  but  a  commodity,  and  that  it  makes  no  dif- 
ference with  a  nation,  whether  money  or  any  other  commodity  be 
parted  with  in  trade.  We  say,  that  money  is  more  than  a  com- 
modity ;  that  it  is  the  instrument  or  "  tools  of  trade  ;"  and  that,  in 
parting  with  these  "  tools,"  by  an  imprudent  foreign  commercial 
policy  —  as  we  necessarily  must,  from  the  position  we  occupy, 
without  a  protective  system  —  we  part  with  the  means  of  trade, 
both  domestic  and  foreign,  as  effectually,  as  truly,  and  in  the  same 
manner,  as  a  mechanic  parts  with  his  means  of  living,  when  he 
sells  his  tools.  They  say,  there  Is  no  need  of  guarding  these  tools; 
that  they  will  take  care  of  themselves ;  that,  if  they  go  away,  they 
will  come  back  again,  in  the  natural  course  of  things.  We  say, 
that  they  will  certainly  go,  unless  taken  care  of  (which  they  do 
not  deny)  ;  that  when  a  mechanic's  tools  are  gone,  he  must  stop 
work  ;  that  he  loses  time,  and  suffers  loss,  till  he  can  supply  him- 
self again  ;  that,  for  these  reasons,  it  is  unwise  to  sell  his  tools, 
though  he  gets  an  equivalent ;  that  it  may  be  a  long  time,  and  very- 
hard  work,  for  him  to  be  well  set  up  in  his  business  again  ;  that, 
in  the  meantime,  he  will  have  lost  all  the  wealth  he  could  have 


264  THE    GAINS    OF    INDIVIDUALS    NOT    ALWAYS 

acquired,  if  he  had  kept  his  tools,  and  been  all  the  while  at  work 
with  them. 

We  have  shown,  that  money  is  not  an  article  in  kind;  that  it  is 
something  more  than  a  commodity  ;  that  it  is  the  instrument  of 
trade,  and  as  such,  occupies  a  very  different  position  from  the 
commodities  for  which  it  is  given  in  exchange  ;  that  it  discharges 
the  same  functions  in  the  hands  of  a  nation,  in  carrying  on  its  trade, 
as  do  "  the  tools  of  trade"  in  the  hands  of  a  mechanic,  in  carrying 
on  his  work  ;  and  that  the  effect  would  be  the  same  for  a  nation  to 
part  with  money,  which  it  wants  in  trade,  as  for  a  mechanic  to  part 
with  his  tools.  The  difference  between  us  and  our  opponents, 
therefore,  in  these  two  opposite  positions,  is  vital  and  heaven-wide. 

From  this  digression  on  equivalents  in  exchanges  —  as  to  the 
principle  of  which  we  have  no  controversy  with  Mr.  M'Culloch 
and  those  of  his  school,  but  assent  to  it  —  let  us  return  to  the  con- 
sideration of  their  proposition,  that,  as  the  wealth  of  a  nation  is 
composed  of  the  aggregate  wealth  of  the  individuals  in  it,  whatever 
an  individual  gains,  the  nation  gains. 

Generally  speaking,  in  domestic  exchanges,  this  is  true  ;  but  not 
always.  A  robber,  or  a  cheat,  gains  by  his  depredations.  Is  the 
community  benefited  '!  A  man,  in  domestic  trade,  has  made  a 
good  bargain,  entirely  at  the  expense  of  the  second  party,  as  some- 
times, not  unfrequenily,  happens.  Is  the  general  wealth  increased? 
But  nothing  is  more  common,  or  better  known,  than  that  bargains 
are  made,  and  trade  consummated,  every  day,  in  which  one  party 
gains  and  the  other  loses  ;  and  frequently  when  all  the  gain  of  one 
party  is  the  measure  of  loss  to  the  other.  Generally,  however,  it 
is  admitted,  as  Adam  Smith  and  others  assert,  that  two  values, 
composed  of  the  profits  of  each  party,  are  added  to  the  public 
wealth,  in  domestic  exchanges  ;  whereas,  in  foreign  trade,  if  profit- 
able to  both  parties,  only  one  value,  and  that  a  mere  profit  in  trade, 
is  added  to  home  capital.  Hence,  other  things  being  equal,  every 
domestic  exchange  is  equal,  in  the  augmentation  of  domestic  cap- 
ital, to  two  foreign  exchanges  ;  and  it  need  not  be  said,  how  much 
more  frequent  and  less  expensive  domestic  exchanges  are.  Hence, 
the  greater  importance  of  the  home-trade. 

But  to  proceed.  The  proposition  of  the  Free-Trade  econ- 
omists, is,  that  what  an  individual  gains  in  foreign  trade,  the  nation 
gains.  There  are  two  points  on  which  this  proposition  fails,  and 
is  proved  false  as  a  rule,  though  it  may  sometimes  be  true.  The 
first  is,  that  they  who  have  laid  it  down,  make  no  distinction  Jdc- 


THE    GAIN    OF    THE    NATION.  265 

tvveen  imports  for  the  consumption  of  their  vahies,  and  imports  of 
permanent  and  increasing  value,  as  the  one  class  and  the  other, 
respectively,  affect  national  wealth  ;  and  the  second  is,  that  they 
do  not  distinguish  between  the  gains  of  one  party  which  are  losses 
to  others,  or  injuries  to  the  public,  and  gains  which  do  no  harm  to 
others,  or  the  public,  but  are  indifferent  in  their  relative  effects,  or 
beneficial. 

A  merchant  panders  to  the  appetites,  fancy,  tastes,  and  extrava- 
gant propensities  of  his  customers  —  not  to  benefit  them,  but  for 
his  own  profit.  The  Free-Trade  economists  say,  that  his  cus- 
tomers get  an  equivalent.  That  they  get  a  technical  equivalent, 
we  do  not  deny  ;  or  we  are  willing  to  grant  it.  If  a  customer  buys 
and  drinks  a  gallon  of  brandy,  or  of  wine,  imported,  not  only  the 
profit  of  the  merchant,  but  the  cost,  is  at  the  expense  of  the  com- 
munity, unless  it  can  be  shown,  that  the  community  is  benefited  ; 
which  would  be  very  difficult.  Allowing  that  the  profit  of  the 
merchant  stays  in  the  country,  it  is  no  increase  of  its  capital,  but 
has  only  changed  hands  ;  whereas,  the  brandy  and  wine  being  im- 
ports, the  capital  of  the  country  is  minus  the  cost,  and  is  not  aug- 
mented by  the  profit  of  the  merchant.  It  is  the  same  with  cloths 
and  with  everything  imported  for  the  consumption  of  its  value  at 
home.  The  profits  of  merchants,  in  such  cases,  are  no  augmenta- 
tion of  domestic  capital ;  and  the  cost,  which  is  the  principal  part 
of  the  price,  is  so  much  subtraction  from  the  capital  of  the  country  ; 
so  that  there  is  no  gain,  and  apparently  much  loss. 

So  long,  however,  as  the  country  pays  for  these  imports  by  ex- 
ports of  its  surplus  products,  and  does  not  part  with  its  money,  with 
its  "  tools  of  trade,"  but  employs  its  money  at  home  to  move  these 
surpluses  on  to  their  foreign  destination,  and  to  distribute  the  im- 
ports received  in  exchange  for  them,  then  the  profits  of  merchants 
are  an  augmentation  of  domestic  capital ;  as  are  also  all  the  imports 
of  a  durable  and  useful  kind,  to  be  incorporated  with  the  perma- 
nent capital  of  the  country,  or  by  such  incorporation  to  render 
domestic  capital  more  valuable  and  more  productive  ;  but  the  cost  of 
all  that  is  consumed  to  the  annihilation  of  its  value,  must  be  ranked 
with  luxuries  which  the  country  can  afford,  and  not  with  the 
materials  of  its  wealth,  or  increased  capital.  It  is  really  no  aug- 
mentation of  wealth,  any  farther  than  the  profits  of  the  trade  are 
concerned,  notwitlistanding  that  all  these  imports  are  technical 
equivalents. 

Although  there  is  no  loss,  but  some  gain,  so  long  as  the  money, 


266  THE    GAINS    OF    INDIVIDUALS    NOT    ALWAYS 

of  the  country,  or  its  "  tools  of  trade,"  are  not,  but  only  its  sur- 
plus products,  are  exported  to  pay  for  these  imports,  nevertheless, 
the  gain  of  the  nation  would  be  much  greater,  and  all  the  greater 
of  the  cost  of  these  imports,  so  far  as,  by  a  protective  policy,  they 
could  be  produced  at  home,  in  exchange  for  the  same  products, 
provided  they  could  be  produced  equally  or  more  ciieap  ;  and  it 
has  been  elsewhere  shown,  that,  whatever  is  produced  at  home, 
under  a  protective  system,  which  could  not  otherwise  be  produced, 
is,  generally,  and  in  the  end  always,  cheaper  than  the  foreign  prod- 
uct. Although,  therefore,  the  imports  received  in  exchange  for 
surplus  domestic  products  exported,  may  be  technically  called 
equivalents,  and  are  an  augmentation  of  national  capital,  so  long 
as  the  nation's  "  tools  of  trade"  are  not  required  to  pay  for  them  ; 
still  the  national  capital  would  be  as  much  more  augmented  as  the 
cost  of  all  these  imports  that  could  be  produced  at  home,  under  a 
protective  system,  it  being  supposed  that  their  domestic  production 
would  consume  the  articles  otherwise  exported  to  purchase  them. 

We  are  aware  that  the  Free-Trade  economists  are  ready  on 
this  point  to  say,  and  that  they  have  said,  that  what  you  take  off 
from  home  labor  to  produce  these  articles  of  manufacture  —  sup- 
posing them  to  be  of  this  kind  —  undter  a  protective  system,  you 
subtract  from  agriculture  and  other  labor,  and  therefore  lose  what 
this  labor  would  produce  in  those  quarters;  to  which  we  answer, 
first,  that  the  labor  thus  diverted,  is  but  a  small  fraction  of  the  labor 
of  tlie  country;  and  next,  that  the  addidonal  stimulant  which  this 
home  market  imparts  to  other  departments  of  labor,  is  more  than  a 
compensation  for  this  loss.  American  labor  is  so  independent,  that 
its  power  is  never  stretched  to  that  ne  ylus  ultra  of  exertion,  as  in 
Europe,  which  the  theory  of  this  reply  to  us  supposes;  and  it  is 
capable,  when  prompted  by  interest,  not  only  of  filling  up  this 
vacuum,  when  created,  but  much  more.  This  reply,  therefore, 
can  not  answer  its  intended  purpose,  and  our  argument  prevails, 
to  wit,  that  the  capital  of  the  nation  would  be  augmented  to  the 
full  amount  of  the  cost  of  these  articles,  so  far  as  they  could  be 
produced  at  home  under  a  jjrotective  system,  notwithstanding  that 
the  exchanges  with  foreign  parts  are  allowed  to  be  equivalents. 
The  home  production  thus  saves  to  the  country  the  cost  of  one  of 
these  equivalents,  so  that  it  realizes  both. 

But  when  the  nation  buys  of  all  foreign  parts  more  than  it  sells 
to  them  of  its  own  surplus  products,  and  hs  cash,  in  other  words, 
its  "tools  of  trade,"  are  put  in  requisition  \o  settle  balances,  these 


THE    GAIN    OF    THE    NATION.  267 

exchanges,  too,  may  be  allowed  to  be  technical  equivalents.  We 
concede  this  point.  But  there  is  one  point  claimed  by  our  oppo- 
nents, which  we  can  not  concede,  viz.,  that  this  gold  and  silver, 
these  "tools  of  trade,"  thus  parted  with  for  imports,  are  mere  com- 
modities ;  that  they  occupy  the  same  position  in  trade  as  the  com- 
modities for  which  they  are  exchanged  ;  and  ti)at  they  are  only 
subjects  of  trade.  We  allow,  that  they  are  commodities,  but  deny 
that  they  occupy  the  same  position  with  others.  They  are  instru- 
ments, "tools,"  not  subjects  of  trade,  vi'hen  they  go  to  settle 
balances. 

But  we  are  told  that  what  the  merchants  gain  in  foreign  trade, 
the  nation  gains.  Go  back  to  the  disastrous  period  of  1836— '37. 
The  merchants  had  for  years  been  growing  rich  by  excessive  im- 
ports, tempting  the  people  to  buy  and  consume  ;  and  the  end  of  it 
all  was  a  general  bankruptcy.  The  very  means  by  which  merchants 
made  princely  fortunes,  prostrated  the  nation.  Yet,  according  to 
these  Free-Trade  economists,  we  had  our  equivalents,  and  were 
growing  rich.  Long,  however,  before  the  equivalents  due  from 
us  were  rendered,  we  were  forced  to  stop  payment,  and  fund  the 
debt.  Having  lost  our  "tools  of  trade,"  we  continued  in  a  state 
of  insolvency,  and  poor,  till  the  tariff  of  1842  enabled  us  to  begin 
making  new  "tools,"  and  to  hammer  away  again  to  get  out  of 
debt.  Still  the  Free-Trade  economists  say,  there  was  no  harm  in 
our  losing  these  "  tools  ;"  gold  and  silver  are  nothing  but  commod- 
ities in  trade ;  we  had  our  equivalents,  and  were  growing  rich  all 
the  while. 

We  will  not,  therefore,  consent  to  the  imputation  of  denying 
that  the  whole  is  equal  to  its  parts,  when  we  say  that  the  gains  of 
individuals  in  foreign  trade,  are  no  certain  evidence  of  the  gain  of 
the  nation,  and  that  a  nation  may  be  impoverished  by  the  very  acts 
which  enrich  some  of  its  individuals.  It  must  first  be  considered 
and  determined  whether  these  gains  of  individuals  come  from 
without  or  within  the  nation.  If  they  come  from  without,  the  na- 
tion, otlier  things  being  equal,  is  enriched  ;  if  from  within,  it  is 
Peter  giving  to  Paul.  The  nation  is  not  enriched,  and  may  be 
impoverished.  It  is  inevitably  impoverished,  if  the  price  only 
passes  from  Peter,  the  consumer,  to  Paul,  the  merchant,  that  Paul, 
after  retaining  his  profit,  may  remit  the  cost  to  the  foreign  producer, 
if  that  remittance  is  composed  of  the  nation's  "  tools  of  trade." 

Doubtless  the  people  of  the  United  States  can  produce  enough 
for  all  their  necessities,  without  money,  as  their  forefathers  did, 


26S         IMPORTS  FOR  CONSUMPTION  OF  VALUE 

under  the  British  crown,  and  during  the  confederation.  But  will 
they  be  content?  Have  they  not  a  right  so  to  protect  themselves, 
as  to  be  able  to  have  money  enough  circulating  among  them  to  do 
their  business  with  ?  It  is  vastly  convenient  and  economical  to 
trade  with  money,  and  not  be  forced  back  to  barter.  It  is,  indeed, 
the  very  purpose  of  money,  to  facilitate  the  operations  of  barter, 
and  to  abridge  its  round,  till  it  becomes  no  round  at  all,  so  that  a 
man  who  has  money  can  always  get  the  thing  he  wants,  instead  of 
being  compelled  to  barter  for  it.  But  let  the  money  of  a  com- 
munity go  to  pay  its  foreign  debts,  which  it  ought  never  to  have 
contracted,  and  all  is  at  a  stand. 

But  it  is  worth  while  to  consider  more  particularly  the  difference 
between  imports  for  consumption  of  their  values,  and  imports  of 
permanent  value,  to  be  incorporated  with  the  permanent  or  pro- 
ductive capital  of  the  country,  or  to  be  worked  over  as  raw  mate- 
rials for  the  increase  of  its  value  by  home  labor;  and  to  consider 
them,  as  they,  respectively,  subtract  from  or  add  to  the  capital  and 
wealth  of  the  country.  All  will  be  surprised,  who  do  not  know 
the  fact,  when  told  that  the  Free-Trade  economists  make  no  dis- 
tinction between  imports  for  consumption  of  their  values,  and  im- 
ports of  permanent  or  increasing  value,  as  the  two  kinds  affect  the 
wealth  of  a  nation. 

Take,  for  example,  the  excessive  imports  into  the  United  States, 
before  the  revulsion  of  1836— '37,  chiefly  for  consumption  of  their 
values,  as  $20,000,000  of  silks  a  year,  and  such  like,  till,  in 
1S36,  the  imports  exceeded  the  exports  by  SCO, 000, 000.  A  large 
portion  of  these  excesses  of  imports,  may  be  assumed  as  consisting 
chiefly  of  articles  for  the  consumption  of  their  values,  of  which 
no  quid  jiro  quo  could  afterward  be  found.  They  went  into  the 
bellies  and  on  the  backs  of  an  unwise  and  extravagant  people,  and 
the  merchants  made  their  fortunes  by  it.  These  goods  could  not 
have  arrived  at  their  destination  without  large  profits ;  and  the  doc- 
trine of  the  Free-Trade  economists  is,  that  the  gain  of  individuals 
is  the  gain  of  the  nation.  It  is  by  such  doctrine,  that  the  United 
States  have  repeatedly  been  brought  to  the  verge  of  ruin,  and  more 
than  once  plunged  into  the  abyss. 

But  imports  of  permanent  value,  which  constitute  a  part  of  the 
capital  of  the  country,  and  imports  of  raw  materials,  to  be  worked 
over  and  upon  for  the  multiplication  of  their  values,  occupy  a  very 
different  position  in  public  economy,  from  those  the  values  of  which 
are  consumed  in  the  use.     The  following  history  of  a  jjoimd  of 


AND    FOR    INCREASE    OF    WEALTH.  269 

cotton,  from  an  Entjlish  paper,  will  illustrate  the  values  added  by 
manufacturing:  "There  was  sent  off  for  London,  lately,  from 
Glasgow,  a  small  piece  of  muslin,  about  one  pound  weight,  the 
history  of  which  is  as  follows:  The  cotton  came  from  the  United 
States  to  London  ;  from  London  it  went  to  Manchester,  where  it 
was  manufactured  into  yarn ;  from  Manchester  it  was  sent  to  Pais- 
ley, where  it  was  woven  ;  it  was  sent  to  Ayrshire  next,  where  it 
was  tamboured  ;  afterward  it  was  conveyed  to  Dumbarton,  where  it 
was  handsewed  and  again  returned  to  Paisley,  when  it  was  sent  to 
a  distant  part  of  the  county  of  Renfrew  to  be  bleached,  and  was 
returned  to  Paisley  ;  then  sent  per  coach  to  London.  It  is  diffi- 
cult precisely  to  ascertain  the  time  taken  to  bring  this  article  to  mar- 
ket, but  it  may  be  pretty  near  the  truth  to  reckon  it  two  years  from 
the  time  it  was  packed  in  America  till  its  cloth  arrived  at  the  mer- 
chant's warehouse  in  London,  whither  it  must  have  been  conveyed 
3,000  miles  by  sea,  and  920  by  land,  and  contributed  toward  the 
support  of  no  less  than  150  people,  whose  services  were  necessary 
in  the  carriage  and  manufacture  of  this  small  quantity  of  cotton, 
and  by  which  the  value  has  been  advanced  2,000  per  cent.  What 
is  said  of  this  piece,  is  descriptive  of  no  inconsiderable  part  of  the 
trade." 

The  following  is  another  extract  from  an  English  journal  to  the 
same  point :  — 

"The  quantity  of  casi-iron  worth  £1  sterling,  becomes  worth  the  following 
sums : — 

When  converted  into  ordinary  machinery £4.00 

Laree  ornamental  work 45.00 

Buckles— Berlin  work fi60.00 

Neck  chains 1386.00 

Shirt  buttons , 5896.00 

"The  quantity  of  bar  iron  worth  £1  sterling,  becomes,  when  formed  into — 

Horse-shoe  work £2.10 

Knives  (table) 36.00 

Needles 71 .00 

Penknife  blades 657.00 

Polished  buttons  and  buckles 897.00 

Balance-springs  of  watches 50,000.00" 

The  question  with  Americans  is,  whether  these  values,  running 
up,  in  one  instance,  from  1  to  2,000,  in  another,  from  1  to  5896, 
and  in  a  third,  1  to  50,000,  shall  be  created  at  home,  and  remain 
here  as  part  of  the  capital  of  the  nation  ;  or  whether  they  shall  be 
created  abroad,  and  this  capital  be  lost  to  us  ?  These  are  only 
three  of  hundreds  of  similar  instances,  involving,  as  the  case  may 


270         IMPORTS  FOR  CONSUMPTION  OF  VALUE 

be,  the  loss  or  gain  of  uncounted  private  and  public  wealth,  to  one 
side  or  the  other. 

Many  things  are  also  imported  as  permanent  fixtures  in  the 
means  or  instruments  of  wealth,  which  are  of  more  or  less,  sotne 
of  "-reat  value.  Many  of  the  mechanic  and  fine  arts  import  their 
instruments,  not  obtainable  at  home.  A  great  variety  of  imports 
are  brought  in  as  means  of  wealth. 

But  tlie  Free -Trade  economists  make  no  distinction  between 
articles  that  are  consumed  in  the  using,  and  those  which  are  em- 
ployed for  the  increase  of  wealth.  It  may  be  allowed,  that  all  that 
is  consumed  to  nerve  the  arm  of  labor,  and  make  it  more  available, 
and  all  that  is  consumed  to  make  skill  more  productive,  belong  to 
the  latter  class;  and  it  may  also  be  allowed,  as  it  is  undoubtedly 
true,  that  all  the  wastes  and  extravagances  of  those  who  can  affoid 
it,  make  more  work  and  profit  for  the  industrious  and  frugal.  All 
private  and  public  expenditures  give  employment  to  labor  and  art. 
But  when  we  come  to  the  question  of  the  greatest  national  econ- 
omy, all  these  things  are  to  be  sifted,  and  well  considered.  It  is 
evident  that  a  nation  may  be  losing  on  an  immense  scale,  when, 
according  to  the  doctrines  of  the  Free-Trade  economists,  it  is  as- 
serted to  be  increasing  in  wealth.  According  to  these  doctrines, 
the  Unit;^d  States  were  never  doing  better,  never  so  well,  as  from 
1835  to  1840,  when  they  were  plunging  headlong  into  general 
bankruptcy,  where,  as  need  not  be  said,  tliey  arrived,  to  the  great 
sorrow  and  painful  remembrance  of  all  who  lived  in  those  times. 

As  a  farther  illustration  of  the  profit  of  manufactures  to  a  nation, 
we  wotdd  commend  the  following  extract  from  Mr.  Gilbart's 
*'  Lectures  on  Ancient  Commerce"  : — 

"All  nations  that  become  manufacturing  nations,  have  become 
commercial  nations ;  and  have,  consequently,  become  wealthy. 
Manufacturing  nations  rise  to  wealth  from  the  additional  value 
which  they  give  to  the  raw  materials.  For  there  is  an  immense 
difference  between  the  value  of  the  raw  materials  and  the  value  of 
the  same  materials  in  a  manufactured  state.  These  high  prices 
arise  from  the  immense  quantity  of  labor  that  is  expended  on 
the  articles.  This  is  the  reason  why  manufacturing  nations  get 
wealthy,  because  they  give  employment  to  the  whole  population. 
Men,  women,  and  children,  are  all  employed.  The  effect  on 
national  wealth  may  be  thus  illustrated.  If  I  had  an  estate  so 
fertile,  that  for  every  bushel  of  seed,  I  should  have  a  crop  of  GOO 
bushels,  I  should  soon  get  rich.     But  if,  for  the  price  of  a  bushel 


AND    FOR    INCREASE    OF    WEALTH.  271 

of  wheat,  I  can  buy  a  quantity  of  raw  material,  and  by  the  labor  I 
bestow  upon  it,  I  can  sell  it  for  the  price  of  600  bushels,  it  is  the 
same  thing  to  me  as  though  I  had  an  estate  which  yielded  a  crop 
of  GOO-fold.  In  inanufactures  you  can  introduce  a  greater  quantity 
of  machinery.  Agricuhure  labors  under  this  disadvantage,  that, 
whatever  machinery  we  apply,  all  we  can  do  is  to  increase  the  crop, 
and  to  cheapen  some  of  the  operations  ;  we  can  not,  to  any  extent, 
quicken  the  process.  We  may,  by  machinery,  weave  a  piece  of 
cotton  or  silk,  or  make  a  pair  of  razors,  in  half  the  time  heretofore 
employed  ;  but  we  can  not  make  a  field  produce  a  crop  of  wheat, 
barley,  or  potatoes,  in  half  the  usual  time.  Seed-time  and  harvest 
will  go  on,  and  the  operations  of  nature  will  not  be  stimulated,  to 
any  great  extent,  by  any  machinery  we  can  apply." 

But  to  return  to  the  main  question  of  this  chapter,  as  to  whether 
the  gain  of  individuals  is  the  gain  of  a  nation.  The  following  prin- 
ciple, incidentally  recorded  by  Ricardo,  is  itself  alone  sufficient  to 
settle  it,  viz.,  that  "every  transaction  in  commerce,  is  an  inde- 
pendent transaction."  But  Ricardo,  and  those  of  his  school,  aver, 
that  in  all  cases,  the  nation  profits  in  the  profit  of  its  merchants, 
who  are  entjasfed  in  foreign  trade.  The  merchant  trades  to  <ret 
rich,  not  to  enrich  his  country.  His  eye  is  solely  on  his  own  inter- 
est, and  he  acts  independently  of  all  other  results.  "Every  trans- 
action in  commerce,  is  an  ivdrpende///  transaction."  The  jobber, 
who  stands  between  the  importer  and  the  retailer,  trades  on  the 
same  principle  of  self-interest  and  independence,  with  the  importer; 
the  retailer  also  trades  on  the  same  principle  ;  and  the  consumer 
buys  on  the  same  principle.  "  Every  transaction  is  independent" 
alike  of  every  other,  and  of  the  general  good.  We  will  suppose 
it  happens  in  the  end,  that  consumers,  retailers,  jobbers,  and  im- 
porters, have  together,  in  their  independent  transactions,  and  in 
the  aggregate,  bought  more  of  the  foreign  world,  than  they  have 
sold,  and  owe  a  balance  in  cash,  which  must  be  remitted,  notwith- 
standing, as  we  will  suppose,  that  the  importers,  jobbers,  and  retail- 
ers, have  all  got  rich  by  these  transactions.  Is  it  not  manifest,  by 
other  parts  of  this  argument,  that  they  have  got  rich  at  the  expense 
of  the  country? 

M.  Say  carries  the  argument  of  profit  arising  from  the  sale  of 
specie,  to  a  most  extravagant  point.  For  example:  "A  nation 
gains  in  wealth  by  the  partial  export  of  its  specie,  because  the 
residue  is  of  equal  value  to  the  total  previous  amount,  and  the 
nation  receives  an  equivalent  for  the  portion  exported.     Whence 


272  THE    GAIN    OF    INDIVIDUALS    NOT    ALWAYS 

it  is  evident,  that  governments  should  encourage,  instead  of  dis- 
couraging, the  export  of  specie." 

"  The  residue  is  of  equal  value  !"  That  is  to  say,  it  must 
answer  the  purpose  of  the  nation's  "  tools  of  trade,"  though  it  is 
but  half  a  set,  or  a  quarter  it  may  be  ;  but  the  value  of  every  prod- 
uct of  labor,  and  of  labor  itself,  must  fall  in  that  proportion,  or 
tend  to  that  point  till  it  gets  there,  under  a  permanency  of  such  a 
state  of  things.  M'Culloch  has  laid  down  the  principle  —  a  sound 
one  —  thus:  "If  the  quantity  of  money  in  Great  Britain,  were  re- 
duced a  half,  the  rate  of  wages  [and  of  course  the  value  of  the 
products  of  labor]  estimated  in  money,  would  decline  in  the  same 
proportion."  A  sixpence  must  answer  the  same  purpose  that  a 
shilling  did  before,  else  "the  residue  is  not  of  equal  value."  If 
the  shilling  state  of  things  was  good,  why  disturb  it  for  the  profit 
of  a  kw  traders,'  when  this  25  or  50  percent,  depression  of  prices 
is  an  infinitely  greater  loss  to  the  community,  than  what  the  traders 
have  gained  ;  which,  apparently,  M.  Say  did  not  think  of.  Be- 
sides, if  he  does  not  propose  this  as  a  permanency,  these  fluctu- 
ations are  a  public,  involving  private,  misfortune.  What  nation 
could  stand  this  having  just  enough  "  tools  of  trade"  one  year ; 
half  enough  a  year  after  ;  three  quarters  enough  the  third  year ; 
and  so  on  ;  prices  constantly  falling  and  rising  accordingly,  never 
too  high,  but  often  too  low,  sometimes  ruinous?  As  to  the 
"equivalent"  received,  the  traders  may  get  it;  but  does  the  nation 
get  it?  The  nation,  peradventure,  has  worn  out  a  part  on  their 
backs,  and  the  rest  has  gone  into  their  bellies,  which,  as  in  the  case 
of  all  spendthrifts  and  gourmands,  they  had  better  have  done  with- 
out. And  so,  for  such  reasons,  "  governments  should  encourage, 
instead  of  discouraging  the  export  of  specie!" 

Again  he  says:  "  The  superiority  of  money,  in  the  interchange 
between  individuals,  does  not  exiend  to  that  between  nation  and 
nation.  In  the  latter  money,  and,  a  fortiori,  bullion,  lose  all  the 
advantage  of  their  peculiar  character  as  money,  and  are  dealt  with 
as  mere  commodities." 

It  will  be  seen,  that  M.  Say  grants  "  the  peculiar  character  of 
money"  here,  which  is  what  we  denominate  its  character  as  the 
instrument  or  "tools"  of  trade.  But  he  says,  "this  does  not 
extend  to  the  interchange  between  nations."  This  is  an  unqualified 
mistake.  Surely  M.  Say  ought  to  have  known,  that  the  resort  of 
an  importer  in  making  his  remittances  abroad,  to  a  broker  as  an 
intermediate  agent  who  trades  in  exchanges,  does  not  affect  the 


THE    GAIN    OF    THE    NATION.  273 

position  of  the  impo»'<er  in  relation  to  his  foreign  creditor,  nor  the 
functions  of  his  remittances  as  a  consideration  for  the  goods  he 
imports.  It  is  true,  that,  in  the  hands  of  the  broker,  the  remit- 
tances are  subjects  of  trade,  as  "  mere  commodities ;"  but  as 
remittances  from  an  importer  in  one  country  to  a  factor  in  another, 
whether  bullion  or  coin  —  there  is  no  '■^  a  fortiori"  in  the  case  — 
discharge  the  appropriate  functions  of  money  as  the  instrument, 
and  not  as  a  subject,  of  trade.  The  case  supposed  determines 
this.     It  is  "  the  export  of  specie,"  to  pay  for  other  commodities. 

Again  this  astute  reasoner  says:  "Suppose,  for  a  moment,  the 
internal  traffic  and  national  wealth  of  a  given  country  to  be  such, 
as  to  require  the  constant  employment  of  a  thousand  carriages  of 
different  kinds.  Suppose,  too,  that,  by  some  peculiar  system  of 
commerce,  it  should  succeed  in  getting  more  carriages  annually 
imported,  than  were  annually  destroyed  by  wear  and  tear;  so  that, 
at  the  year's  end,  there  should  be  1500  instead  of  1000  ;  is  it  not 
obvious,  in  that  case,  that  there  would  be  500  lying  by,  in  the  re- 
positories, quite  useless,"   etc. 

Give  us  the  thousand  carriages,  and  we  are  satisfied.  The 
question  is  not  about  having  an  additional  500  on  hand,  not  wanted ; 
but  about  parting  with  500  of  the  1000  which  are  wanted.  Most 
incautiously,  M.  Say  has  here  granted  the  very  point  we  contend 
for,  to  wit,  that  there  is  a  certain  amount  of  money  which  the 
trade  of  every  country  requires  as  "  tools"  to  work  with.  Give 
us  the  thousand  carriages,  and  the  question  is  at  rest.  But  what 
M.  Say  contends  for,  is,  that  we  can  not  only  do  with  500,  but  that 
it  would  be  a  fine  speculation  to  sell  even  that  500,  after  we  have 
got  them  in  hand.  Is  not  this  his  reasoning  ?  We  are  certainly 
much  obliged  to  him  for  the  "  carriages,"  because  they  are  exactly 
what  we  wanted. 

18 


274  LABOR. 


CHAPTER    XVIII. 

LABOR. 

Definition. — Who  are  Laborers. — Labor  is  Capital. — The  Effect  of  not  recog-nising  this 
Tact  in  Public  Economy. — The  False  Position  awarded  to  Labor  by  the  Economists. — 
The  Position  which  they  themselves  occupy  False. — Labor  Capital  vested  in  Man  him- 
self, and  estimated  by  his  Life  and  Powers. — Labor-Capital  reproduces  itself  indefinitely. 
— It  is  the  Parent  of  all  other  Capital  — It  is  njore  Profitable  than  any  other. — It  is  the 
Gift  of  God.  and  Inalienable. — -The  Machinery  of  Society  is  its  Product,  which  rcact-s  to 
give  it  Value — Labur  Capital  may  be  under  Restraint,  in  Certain  Circumstances. — La- 
bor the  Source  of  all  Wealth,  by  creating  all  Commercial  Values. — Labor  bound  to  share 
in  the  Burdens  of  Society  and  entitled  to  Protection. — Labor  in  its  True  Pos'tion, 
defines  Human  Kii^hts. — The  Perversion  and  Abu.se  of  those  Rights,  owing  to  its  False 
Position  in  Public  Economy. — The  Results  of  the  American  Revolution  put  it  in  the  right 
Place — Labor  Man's  Honor,  not  Disgrace — It  is  the  great  Political  Element. — Labor 
Discovered  and  made  America. — American  Independence,  Labor's  Jubilee. — Its  Conse- 
quences.— "  Rent."  as  practised  in  Europe,  created  Classes. — Labor  con.sidered  as  the 
Agent  of  Power,  and  as  an  Independent  Agent. — The  former  Slavery,  the  latter  Free- 
dom— The  Fir.st  the  State  of  Labor  in  Europe,  the  second  its  Condition  in  tlie  United 
States. — The  Malthusian  Theory,  as  it  justified  European  Economists  and  European 
Society,  in  enslaving  Labor.— The  Theory  a  Blasphemy — This  Problem  solved  in 
America. — Origin  of  the  term  Landlord,  with  its  Lessoir — Labor,  to  be  Free,  must  have 
an  Alternative  in  another  Chance  beside.s  the  Wages  offered. — Europe  does  not  afford 
that  Chance.  America  does — Political  Chances  of  American  Citizens. — Causes  and  Ef- 
fects of  the  Difference  in  the  Value  of  Labor  and  Money,  in  Europe  and  America. — 
The  Power  and  Aims  of  Governments  which  oppress  Labor. — The  Intere.-ts  of  Civi- 
lization vested  in  Labor. — The  Riglits  of  Labor,  Political. — The  Rights  of  Labor  the 
Strife  of  the  Age — The  Pivot  on  which  it  turns. 

Labor  is  the  application  of  the  powers  and  devices  of  man,  to 
supply  the  wants  and  gratify  the  desires  of  the  race. 

It  will  be  seen  by  this  definition,  that  laborers  are  a  very  com- 
prehensive class.  They  are  not  confined  to  those  who  engage  in 
manual  toil ;  who  dig,  or  who  plough  the  land  or  ocean  ;  who  are 
occupied  in  the  various  branches  of  agriculture,  manufactures,  and 
commerce  ;  in  the  mechanic,  useful,  or  fine  arts  ;  who  construct 
canals  and  railroads,  build  houses  or  ships ;  who  make  hard  hands 
and  hard  fists,  by  striking  hard  blows  ;  who  wipe  the  sweat  from 
the  brow  of  toil,  in  any  vocation,  in  doors  or  out,  on  land  or  water; 

—  but  all  who  apply  their  powers  and  faculties,  of  body  or  mind  ; 
their  hands,  or  their  heads,  or  their  fingers  ;  their  invention  or  their 
skill ;  their  hearts  or  their  intellect,  to  supply  the  wants  of  society  ; 

—  the  scholar,  the  learned  professions,  teachers  of  every  class, 
artists,  authors,  devotees  of  science  and  literature ;  legislators, 
mao-istrates,  judges,  clerks,  and  many  other  classes,  more  than  can 


LABOR.  275 

be  named  or  thought  of;  yet,  being  devoted  to  productive  indus- 
try and  improving  pursuits,  necessary  to  society,  and  to  the  supply 
of  the  wants  and  desires  of  the  race;  all  these  are  properly  ranlied 
among  laborers. 

Dr.  Paley  says :  "  Every  man  has  his  work.  The  Wnd  of 
work  varies;  and  that  is  all  the  difference  there  is.  A  great  deal 
of  labor  exists  besides  that  of  the  hands;  many  species  of  industry 
besides  bodily  operation,  equally  necessary,  require  equal  assi- 
duity, more  attention,  more  anxiety.  It  is  not  true,  therefore,  that 
men  of  elevated  stations  are  exempted  from  work ;  it  is  only  true  that 
there  is  assigned  to  them  work  of  a  different  kind  ;  whether  more 
easy  or  more  pleasant,  may  be  questioned  ;  but  certainly  not  less 
wanted,  nor  less  essential  to  the  common  good." 
l/  Labor  is  capital,  primary  and  fundamental.  The  position  which 
is  usually  awarded,  in  systems  of  public  economy,  to  what  is  called 
capital,  as  if  labor  were  not  capital,  and  capital  of  the  most  impor- 
tant kind,  has  tended  to  degrade  labor,  and  to  strip  it  of  its  essen- 
tial attributes  as  the  producer  of  all  adventitious  wealth,  or  of  that 
state  of  things  which  distinguishes  civilized  society  from  barbarism. 
It  has  also  tended  to  cloud  one  of  the  most  important  branches  of 
public  economy  in  obscurity,  and  led  to  much  embarrassment  in 
the  consideration  of  others.  The  natural  order  of  things  is  thus 
reversed  ;  that  which  ought  to  be  first,  is  put  last ;  the  cause  stands 
in  place  of  the  effect;  the  agent  is  taken  for  the  instrument;  the 
producer  for  the  thing  produced. 

Although  it  will  be  convenient  in  this  work,  in  order  to  avoid 
frequent  repetition  and  unnecessary  circumlocution,  to  employ  the 
customary  phrase,  capital  and  labor,  in  the  usual  sense,  it  is  due  to 
a  just  consideration  of  the  comparative  claims  of  these  two  things, 
to  assert  the  prior  and  paramount  rights  of  labor,  as  to  the  position 
to  which  it  is  entitled  in  a  system  of  public  economy.  Labor  is 
capital  of  its  own  kind,  not  as  a  subject  to  be  acted  upon  for  the 
increase  of  its  own  value,  but  as  an  agent  that  imparts  value  to 
every  other  kind  of  capital  which  it  creates,  or  which  after  having 
created,  it  employs  as  an  instrument,  or  takes  in  hand  for  improve- 
ment. It  is  doubtless  true,  that  the  faculties  or  powers  of  labor 
are  subjects  of  culture  and  use,  for  the  increase  of  their  skill  and 
effectiveness,  and  in  this  sense  are  subjects  of  action  for  the  in- 
crease of  their  value.  In  this  particular,  the  faculties  or  powers 
of  labor  occupy  the  position  of  any  other  kind  of  capital,  as  sub- 
jects of  improvement  by  labor  itself.     It  will  be  observed,  how- 


276  LABOR. 

ever,  that  it  is  not  labor,  but  the  faculty  of  labor,  the  value  of 
which  is  thus  increased. 

European  economists,  for  the  most  part,  if  not  universally,  regard 
labor  as  a  mere  power,  like  horse-power,  or  any  other  brute  force; 
and  what  Ricardo  and  the  Adam  Smith  school  mean  by  "the  ;to- 
jioifion  of  the  whole  produce  of  the  earth  allotted"  to  labor,  is 
simply  that  which  is  necessary  for  its  subsistence,  as  for  that  of  a 
horse,  an  ox,  or  any  other  brute.  The  three  chief  elements  of 
public  economy,  as  taught  by  Smith,  Ricardo,  and  others  of  the 
same  school,  are  "  rent,  profit,  and  wages."  It  must  be  seen  that 
a  system  of  public  economy,  constructed  on  such  principles,  is 
entirely  unsuited  to  American  society  ;  and  though  its  doctrines  in  y 
the  abstract  may  often  be  correct,  its  whole  must  be  totally  inappli- 
cable to  a  state  of  things  radically,  fundamentally,  and  essentially 
different  from  that  for  which  such  a  system  is  designed.  It  was 
morally  impossible,  from  the  social  position  of  these  economists, 
that  they  should  be  able  to  adapt  a  system  of  public  economy 
to  American  society,  not  having  thought  it  incumbent  on  them- 
selves to  make  any  other  provision  for  labor,  than  to  save  it  from 
starvation,  and  to  get  the  greatest  profit  out  of  it,  as  the  owner  does 
out  of  his  ox  or  his  horse  ;  and  believing,  as  they  do,  that  system 
the  best  which  will  secure  this  end  most  effectually.  There  can 
be  no  redeeming  quality  with  Americans,  for  a  system  of  public 
economy,  one  of  the  fundamental  principles  of  which  is  of  this 
kind,  pervading  it  throughout,  imparting  its  character  to  it,  and 
constituting  a  part  of  its  very  essence.  The  three  words,  "  rent, 
profit,  and  iiages"  in  the  sense  in  which  they  are  employed  by 
Smith  and  his  school,  as  representing  the  three  comprehensive 
parts  of  their  system,  are  sufficiently  declaratory  of  its  character, 
and  look  back  to  a  feudal  state  of  society.  The  things  here  in- 
tended are  not  to  be  found  in  this  country,  and  are  not  tolerated  ^=*- 
by  its  institutions. 

Labor-capital  is  not  vested  in  the  effect  of  the  faculty  or  power 
of  labor,  but  in  the  power  itself.  The  laborer  himself  is  the  origi-  / 
nal,  fundamental,  most  indispensable  capitalist  of  the  world.  La- 
bor-capital has  no  measure  but  that  of  the  ability  and  life  of  the 
agent,  which  are  always  indefinite.  Labor-capital  is  reproductive. 
It  is  true  that  other  capital  is  called  productive  and  reproductive, 
figuratively  ;  but  its  power  of  reproduction  is  not,  like  that  of  labor, 
in  itself  It  is  the  action  of  the  labor  of  man  upon  it  —  or  of  his 
skill,  which  is  the  same  thing  —  which  makes  it  productive.     Labor 


LABOR.  277 

—  which  here,  and  elsewhere  in  this  work,  is  used  metaphorically 
as  the  agent  —  can  do  the  same  thing  one  moment,  one  day,  one 
year,  which  it  had  before  done,  other  things  being  equal;  and  so 
on,  to  the  end  of  life. 

Labor-capital  is  the  parent  of  all  other  capitaK  Other  capital  is 
chiefly,  if  not  altogether,  the  creature  of  civilization,  though  the 
same  thing,  in  substance,  may  be  found  in  the  savage  state.  But 
as  a  subject  of  public  economy,  it  is  regarded  as  one  of  the  things 
receiving  its  definite  form  and  measure  from  the  hand  of  civil  polity. 
It  will  be  found,  indeed,  that  the  entire  structure  of  civilization 
owes  its  existence  to  labor,  and  of  course  those  parts  of  it  which  de- 
rive their  tangible  value  from  its  forms,  and  which  are  regulatpd  by 
them.  Civilization  itself  is  secondary  and  ministerial,  in  relation 
to  all  the  capital  which  labor  creates,  and  comes  in  to  define  and 
protect  it.  It  was  in  part  the  value  of  these  products  of  labor 
which  made  civilization  necessary,  that  it  might  receive  a  definite 
form,  and  be  made  secure.  No  man  can  apply  his  hand  or  point 
his  finger  to  a  thing  regarded  as  capital,  which  is  not  the  product 
of  labor.  All  intrinsic  values  are  but  fictions  of  the  imagination, 
always  impalpable,  vanishing  as  they  are  approached.  The  dia- 
mond and  the  pebble  are  of  equal  value  in  the  eye  of  the  barba- 
rian, and  would  be  equivalents  in  every  other  eye,  but  for  the  ex- 
istence of  that  capital,  the  product  of  labor,  which  is  able  to  pur- 
chase the  diamond  at  a  high  price.  We  do  not,  however,  mean  to 
say,  that  it  is  improper,  or  without  significance,  to  use  the  terms,  in- 
trinsic value.  They  are  employed  in  this  work  in  the  usual  sense, 
and  are  pertinent  when  so  used,  because  they  represent  a  practical 
idea.  It  will  be  found,  however,  that  this  value  is  entirely  the 
product  of  labor;  and  this  conclusion  may  be  justified  by  the  doc- 
trines of  all  the  economists  worthy  of  respect. 

Labor  is  not  only  the  parent  of  all  other  capital,  bringing  it  into 
existence,  or  preparing  it  for  use;  but  the  use  of  itself,  in  the  dis- 
charge of  these  functions,  is  many  times  more  profitable,  for  a  given 
amount  of  value,  than  any  other  capital.  In  the  United  States,  the  / 
laborer  would  think  he  did  badly,  if  he  could  not  lay  up  50  per^ 
cent.,  or  half  of  his  wages.  Labor,  therefore,  as  capital,  in  this 
country,  may  be  said  to  be  worth  50  per  cent.  Frugal  laborers 
often  make  it  worth  more  than  that,  and  soon  obtain,  in  addition  to 
their  capital  of  labor,  other  capital,  laid  up  and  put  to  use,  con- 
stituting the  nucleus  of  a  fortune  —  the  foundation  of  wealth.  Six 
per  cent,  is  considered  good  use  for  money  and  other  vested  cap- 


278  LABOR. 

ital ;  whereas,  the  savings  of  labor  are  often  from  50  to  75  per 
cent,  of  its  wa<'-es,  besides  the  facuhy  and  chances  of  the  laborer  to 
husband   his  acquisitions   as  the  foundation  and    means  of  future 

wealth. 

Labor-capital  is  the  gift  of  God.     This  is  evident  from  the  fact, 
that  it  is  vested  in  those  powers  and  endowments  which   man  re- 
ceives from  the  hand  of  his  Creator.     It  is  not  dug  from  the  earth ; 
it  is  not  the  handy-work  of  man  ;  but  it  is  the  handy-work  of  (iod. 
Like  Coil,  it  is  endowed  with   intelligence,  and  as  such  is  worthy 
of  great  respect.     In  relation  to  society,  this  capital  is  the  property 
of  the  laborer.     If  it  should  be  said,  that  all  other  capital  is  the  gift 
of  God,  it  is  not  true  in  the  same  sense,  but  only  as  the  product  of 
the  agency  of  labor.     All  die   economists  agree,  that  nothing  in 
nature,  as  it  comes  from  God,  is  capital,  in  the  economical  sense, 
except  as  it  is  appropriated  and   brought  to   use  by  labor.      Tlie 
social  state,  as  observed  above,  is  the   machinery  that  defines  cap- 
ital, and  it  has  put  nothing  in  this  position,  which  is  not  a  product 
of  labor,  real  or  hypothetical.      And  if  it  should  still  be  said,  that 
this  theory  annihilates  labor  as  capital,  it  may  be  answered,  that  the 
machinery  of  society  brings  it  back  to  this  position,  and   installs  it 
in  the  full  possession  of  these  prerogatives.     The  laborer  himself 
being  a  component  part  of  society  —  he  certainly  ought  to  be,  and 
is  supposed  to  be — the  capital  of  labor  is  vested  in  his  powers  to 
do  whatever  he  is  called,  or  may  have  opportunity,  to  do,  to  supply 
the  wants  and  gratify  die  desires  of  the  race,  including  himself,  and 
for  himself  as  to  the  compensation   due  to   his^exertions.      The 
capital,  and  the  consideration  for  the  use  of  it,  are  his,  and  no  man, 
no  power,  can  lawfully  deprive  him  of  them;  and  as^labor  is  the 
orio-inil  ca[)ital  of  society,  giving  birth  to  all  other  forms  of  capital, 
the  dignity  of  its  position  is  equalled  only  by  its  importance. 

Labor-capital,  though  the  property  of  the  laborer,  may  be  justly 
held  under  restraint  or  duress,  as  a  punishment  for  crime.  But 
even  that  condition  does  not  alienate  the  right  of  property  in  the 
ao-ent.  Its  use  and  the  avails  thereof  are  forfeited  to  the  law  for  a 
season;  but  when  the  law  is  satisfied,  the  offender  that  was,  being 
free,  is  entitled  to  reassert  his  property  for  his  own  use  and  benefit. 
Labor  may  be  bound  under  civil  regulations,  for  an  equitable  quan- 
tum of  its  avails,  to  satisfy  indebtedness  incurred  ;  but  the  faculties 
or  powers  of  labor  are  not  and  can  not  be  alienated.  They  are  an 
inheritance  from  God,  not  transferable.  The  claims  of  parents  for 
the  services  of  children,  during  a  minority  fixed  by  the  civil  code, 


LABOR.  279 

if  the  parents  choose  to  assert  them,  are  for  the  payment  of  a  just 
debt,  incurred  by  the  expenses  of  infancy  and  childhood.  But  the 
rights  of  independence  consequent  on  this  period,  as  recognised 
by  Divine  and  human  authority,  presuppose  man's  inalienable 
right  of  property  in  himself,  and  in  his  own  powers. 

Adam  Smith  says  :  "  The  property  which  every  man  has  in  his 
own  labor,  as  it  is  the  original  foundation  of  all  other  property,  so 
is  it  the  most  sacred  and  inviolable.  The  patrimony  of  a  poor 
man  lies  in  the  strength  and  dexterity  of  his  hands  ;  and  to  hinder 
him  from  employing  his  strength  and  dexterity  in  what  manner  he 
tliinks  proper,  without  injury  to  his  neighbor,  is  a  plain  violation 
of  this  most  sacred  property."  Smith  is  here  arguing  against  the 
oppressive  monopolies  of  town  corporations  in  England,  under  the 
law  of  Elizabeth,  a  species  of  monopoly  not  known  in  this  country, 
But  he  asserted  a  great  principle  here.  If  it  was  wrong  and  op- 
pressive to  violate  tlie  rights  of  such  sacred  property,  by  prohibit- 
ing its  use  in  certain  forms,  how  much  more  wrong  and  oppres- 
sive to  use  such  property,  without  a  fiir  compensation? 

It  will  follow,  from  the  foregoing  considerations,  that  labor  is  the  v/ 
source  of  all  wealth.  It  is  true,  indeed,  that  the  world,  untouched 
by  the  hand  of  man,  is  rich  in  its  resources.  But  all  that  which 
is  commonly  called  wealth,  and  which  constitutes  the  weak!)  of 
society,  is  adventitious  —  the  result  of  liuman  labor.  The  precious 
metals  are  obtained  at  great  cost  of  labor;  and  the  forms  given  to 
them  for  the  various  purposes  of  use  and  ornament  to  which  they 
are  applied,  requires  much  additional  labor.  Estates,  buildings, 
roads,  canals,  improvements  of  every  kind,  public  and  private; 
farn)s  and  plantations;  utensils  and  products  of  agriculture,  of 
manufacture,  of  commerce,  and  of  art;  carriages  of  burden  and  of 
pleasure;  ships  and  navies;  instruments  of  war  and  of  peaceful 
vocations;  towns  and  cities  ;  states  and  empires  ;  means  of  luxury 
and  of  usefulness ;  means  and  products  of  the  intellectual,  moral, 
and  physical  culture  of  the  human  race;  laws  and  government; 
civil,  literary,  religious,  and  social  institutions;  the  entire  and  com- 
prehensive forms  and  values  of  human  society,  are  severally  and 
collectively  the  product  and  result  of  human  labor.  All  that  is 
prized  by  money,  and  bought  with  it,  is  obtained  at  the  cost  of 
labor.  The  immense  and  exhaustless  material  of  wealth,  as  it  ex- 
ists in  the  resources  of  nature,  receives  all  its  value  from  the  hand 
of  labor.     "  Whatever,"    says   the  Hon.  Mr.  Appleton,    "  exists 


280  LABOR. 

under  the  name  of  property,  wealth,  or  capital,  Is  the  result  or 
representative  of  previous  labor." 

Labor  is  bound  to  share  in  the  burdens  of  society.  It  has  been 
seen,  that  labor  is  indebted  to  society  for  its  position  and  its  value 
as  capital  ;  that  it  is  capital  of  the  most  important  and  profitable 
kind  ;  that,  in  this  country,  it  occupies  a  dignified  place  in  civil 
and  social  organization  ;  and  that,  without  civilization,  it  would  be 
of  little  or  no  value.  It  is  but  reasonable,  therefore,  that  it  should 
sustain  an  equitable  share  in  the  expenses  or  burdens  of  society. 
But  labor  has  a  claim  to  protection  from  society.  If  labor  is  an 
important  interest  in  and  to  itself,  it  is  no  less  true,  as  already  seen, 
that  it  constitutes  the  vitality  of  all  other  interests  which  are  valua- 
ble in  civilized  society.  It  behooves  society,  therefore,  as  well 
from  what  it  owes  to  labor,  as  from  a  regard  to  its  own  best  inter- 
ests, and  to  all  its  interests,  to  secure  to  labor  those  privileges  and 
advantages,  which  will  promote  its  greatest  prosperity,  and  which 
are  indispensable  to  it.  What  are  those  privileges  and  advantages  ? 
The  answer  is  found  in  four  words  :  Employment  and  fair 
WAGES.  This  is  the  only  protection  which  labor  asks,  and  it  is 
what  it  has  a  right  to  demand,  that  is,  that  the  organization  and  ac- 
tion of  society  shall  not  subvert  this  end. 

In  support  of  this  view  of  labor,  as  capital,  and  the  original,  fun- 
damental capital  of  society,  Adam  Smith  says  :  "  The  annual  labor 
of  every  nation  is  the  fund  which  originally  supplies  it  with  all  the 
necessaries  and  conveniences  of  life  which  it  annually  consumes." 
Stronger  still,  and  more  direct,  he  says  :  "  Labor  was  the  first  price, 
the  original  purchase  money  that  was  paid  for  all  things.  It  was 
not  by  gold  or  by  silver,  but  by  labor,  that  all  the  wealth  of  the 
world  was  originally  purchased."  Doctor  Wayland  says:  "It  is 
clear,  that  everything  which  we  possess,  either  as  nations,  or  as  in- 
dividuals, must  be  the  result  of  labor." 

But  a  point  so  clear  need  not  be  argued  ;  nor  does  it  require  au- 
thority ;  since  every  one  knows  and  feels  it  to  be  true,  as  soon  as 
it  is  stated.  Notwithstanding,  however,  that  it  is  so  plain  a  truth, 
and  notwithstanding  it  has  been  recognised  as  such  by  some  of  the 
economists,  it  is  nevertheless  remarkable  —  very  remarkable  —  that 
it  has  never  been  placed  in  its  true  position,  in  a  system  of  public 
economy.  A  self-evident  truth  often  passes  current,  without  being 
appreciated.  By  the  pride  of  science,  it  is  sometimes  thought  to 
be  worth  little,  because  it  costs  little.  This  is  an  instance.  This 
first  cost  of  everything  that  has  a  commercial  value,  this  "  original 


LABDll.  281 

purchase-money  of  all  things,"  as  Adam  Smilh  calls  it,  has  never 
obtained  its  true  position,  not  even  vviih  him  who  so  highly  honored 

\  it  by  this  incidental  compliment ;  for  it  was  purely  an  incidental  re- 
mark, not  made  for  any  grave  purpose,  and  it  has  been  contested 
b}  some  of  his  school,  foreseeing,  perhaps,  the  consequence.  Much 
less,  has  it  been  installed  in  its  own  proper  place  by  his  followers, 
who  never  did  themselves  the  same  honor  of  blundering  into  a 
recognition  of  the  truth. 

Lab«r  is  not  only  an  element  of  public  economy,  but  it  stands 
back  of  every  other,  and  is  the  parent  of  all.  Yet  it  is  not  found 
in  this  position,  in  any  system  ever  published.  Most  of  the  econ- 
omists havt  put  it  in  the  last  place.  I'hey  found  it  in  a  degraded 
condition,  ahd  have  done  all  in  their  power  to  keep  it  there,  as 
shown  in  anot'aer  chapter. 

Labor,  in  its<rue  position,  defines  human  rights,  without  a  word, 
and  men  will  scarcely  fail  to  recognise  them,  while  it  ren)ains  there. 
But,  when  thrust  cut  of  place,  into  a  false  position,  and  chained  to 
slavery;  when  it  is  made  to  occupy  this  position  in  all  the  systems 
of  public  economy  most  in  vogue  in  the  world,  it  is  no  wonder 
that  men  who  are  entitled,  and  who  ought,  to  be  free,  should  be 
slaves.  In  its  proper  position,  it  proclaims  a  great  truth,  the  con- 
sequences of  which  are  stupendous,  when  carried  out  to  all  its 
legitimate  results,  in  a  system  of  public  economy,  morally  and  so- 
cially considered,  as  well  aa  commercially  —  and  more  especially 
in  the  former  aspects. 

'       The  rocking  of  the  cradle  of  American  independence,  jostled 
into  one  those  distinctive  elements  on  which  the  Free-Trade  econo- 

\iinists  have  founded  their  system.  It  broke  down  the  barriers  of 
classes,  which  form  the  peculiar  features  of  that  system,  and  the 
doctrine  was  then  proclaimed,  that  "  all  men  are  born  free  and 
equal."  As  before,  more  especially  from  that  time,  this  nation 
became  a  community  of  working  men,  in  whose  eyes  labor  is  an 
honor  ;  and  he  who  does  not  work,  is  the  exception  to  the  general 
rule.  Labor,  therefore,  in  the  United  States,  occupies  an  elevated, 
influential,  honorable  position.  It  is  not  the  man  that  lives  by 
work,  but  the  man  tiiat  lives  without  work,  that  is  looked  upon  with 
disrespect.  A  gentleman  of  fortune  and  of  leisyre,  who  does  noth- 
ing, has  far  less  consideration  than  he,  who,  though  equally  able  to 
live  without  work,  devotes  himself  to  some  useful  pursuit. 

When  Adam  Smith  gave  the  following  picture  of  Holland,  sev- 
enty-five years  ago,  he  described  the  United  States  :  "  It  is  there 


282  LABOR. 

unfashionable  not  to  be  a  man  of  business.  Necessity,  among  a 
people  of  small  or  middling  fortunes,  makes  it  usual  for  almost 
everv  man  to  be  so,  and  custom  everywhere  regulates  fashion. 
As  it  is  ridiculous  not  to  dress,  so  is  it,  in  some  measure,  not  to  he 
employed,  like  other  people.  As  a  man  of  a  civil  profession  seesis 
awkward  in  a  camp  or  a  garrison,  and  is  even  in  some  danger 
of  being  despised  there,  so  does  any  idle  man  among  men  of  busi- 
ness." 

Labor,  work,  is  the  spirit,  the  genius  of  the  American  people. 
It  was  so  from  the  beginning  by  necessity  ;  it  became  a  fiv^ed  habit 
of  the  community  ;  and  has  ever  been  a  part  of  the  mo/olc  of  the 
country.  It  is  a  grand  political  element ;  it  was  bon  of  a  great 
political  exigency  ;  it  was  nourished  in  a  political  cra'Jle  ;  it  grad- 
uated into  manhood  with  political  honors  ;  it  mads  with  its  own 
hands,  and  has  ever  worked,  the  machinery  of  the  political  com- 
monwealth ;  it  lies  at  the  foundation  of  the  social  edifice,  pervades 
the  entire  structure,  and  its  escutcheon  stands  out  in  bold  relief 
from  the  pediment.  And  is  this  the  thing,  the  element,  the  power, 
that  is  to  content  itself  with  the  position  and  ihe  doom  of  the  third 
class  enumerated,  defined,  and  described  by  European  economists, 
whose  measure  of  degradation  and  of  comfort  could  not  be  ex- 
pressed by  Adam  Smith  and  others,  as  seen  in  the  citations  from 
them,  without  a  picture  drawn  from  slavery  ? 

Labor  is  the  great  political  power  in  the  United  States.  This  is 
the  natural  result  of  the  social  history  of  the  country.  American 
society  was  a  fragment  of  European  society,  broken  off  by  violence 
in  the  denial  of  its  rights,  and  forced  to  go  out  on  a  mission  in 
search  of  freedom.  It  was  the  working  genius  of  Columbus  that 
disclosed  the  place  of  refuge  ;  it  was  the  working  enterprise  of  the 
first  pilgrims  to  Massachusetts,  to  Virginia,  to  other  points  of  the 
Atlantic  coast,  and  to  the  shores  of  the  great  southwestern  valley, 
that  braved  ocean  perils  and  savage  inhospitality,  to  plant  the  early 
settlements;  it  was  continued,  courageous,  self-sacrificing  toil,  that 
sustained  those  enterprises,  and  pushed  them  onward  to  success 
and  eminence  ;  it  was  long-protracted  work  that  raised  the  colonies 
into  consideration,  and  into  political  and  commercial  importance  ; 
and  it  was  the  hard^ug  of  war,  with  a  prodigal  waste  of  blood  and 
treasure,  that  finally  emancipated  the  new  world  from  the  yoke  of 
the  old,  and  secured  the  wages,  the  reward  of  centuries  of  anxious 
and  laborious  toil.  The  breaking  of  the  British  sceptre  was  the 
installation  of  American  labor  in  its  rights;  it  was  the  foundation 


LABOR.  283 

of  an  empire  of  working  men  ;  and  from  that  hour,  labor  has  been 
the  great  political  power  of  the  country.  The  event  was  a  jubilee 
—  the  jubilee  of  labor. 

There  are  kw,  perhaps,  who  look  so  profoundly  into  the  social 
elements  of  the  world,  as  exactly  to  appreciate,  either  the  nature, 
or  the  gravity,  or  the  importance,  of  the  results  of  the  establish- 
ment of  American  independence,  as  it  is  connected  with  labor,  and 
as  it  bears  upon  it.  After  a  long  preparatory  stage,  coming  at  last 
to  a  crisis,  labor,  by  that  event,  was  lifted  from  its  condition  of 
hopeless  degradation  and  misery  in  Europe,  to  a  position  of  dignity 
and  of  commanding  importance.  It  was  a  substantial,  a  thorough 
emancipation.  Providence  had  opened  the  field,  and  labor  entered, 
not  without  opposition,  not  without  a  struggle,  and  a  fearful,  an 
expensive  one,  to  reap  its  reward.  It  was  a  boundless  field  —  a 
field  which  vindicated  Providence  from  the  libel  of  the  Malihusian 
theory,  that  God  had  made  man,  witliout  providing  for  him  —  a 
field  where  labor  could  walk  abroad  with  a  consciousness  of  its 
own  independence.  The  few  who  had  parcelled  out  Europe 
among  themselves,  and  made  it  subject  to  "rent,"  on  their  own 
terms  —  which  is  the  primal  source  of  the  degradation  of  labor — 
had  not  gone  before,  to  parcel  out  this  broad  continent,  and  to  in- 
stitute a  perpetual  obstruction  to  the  march  of  freedom.  The  field 
was  open,  where  any  man  might  go,  and  mark  out  the  lines  of  his 
own  estate,  build  his  house,  and  work  for  himself  and  for  his  pos- 
terity, and  not  be  forced  to  toil  for  a  master,  at  the  master's  price. 
The  same  alternative  is  still  before  him  ;  and  it  is  this  great  fact 
which  guaranties  the  independence  of  labor  in  this  quarter  for 
ages  to  come  —  it  may  be  said  for  ever.  For  it  must  be  the  fault 
of  labor  itself,  if,  with  such  advantages,  with  such  space  of  the 
earth's  surface  and  of  time,  it  does  not  build  its  own  house,  and 
fortify  its  domain  impregnably  against  the  encroachments  of  future 
masters.  It  is  the  general  condition  of  the  American  people,  as 
original  proprietors  of  the  soil,  or  of  whatever  else  they  live  upon 
or  live  by  —  as  lords  of  their  own  domain  —  that  constitutes  the 
basis  of  their  fortunes  as  freemen.  This  is  the  great  principle  of 
freedom,  and  freedom  can  not  long  exist  without  it.  It  was  "rent" 
in  Europe  that  created  classes,  and  reduced  labor  to  a  condition  of  ^ 
dependent,  fawning,  cringing  servitude;  and  it  is  "  rent"  that  holds 
it  there.  Hence  the  everlasting  song  of  European  economists, 
"  Rent,  profit,  and  wages."  "  Rent"  for  the  first  class,  "  profit" 
for  the  second,  and  "  wages,"  or  bare  subsistence,  for  the  third. 


284  LABOR. 

There  is  not  one  in  a  thousand  of  American  citizens,  who  under- 
stands anythinii;  about  such  a  state  of  things,  or  has  any  idea  of  it. 
And  wliat  is  the  reason?  Because  it  does  not  exist  here.  God 
grant  it  never  may  ! 

But,  there  is  a  very  important  view  of  labor,  regarding  its  rela- 
tive position  in  Europe  and  in  the  United  States,  necessarily  enter- 
ing into  the  systems  of  public  economy  adapted  to  these  two  quar- 
ters, not  yet  distinctly  brought  out,  although  it  has  been  approached, 
and  even  repeatedly  suggested,  in  the  foregoing  remarks.  We 
mean  that  position  which  is  indicated  in  the  one  case,  by  labor  as 
the  AGENT  OF  POWER,    and  in  the  other  as  an    independent 

AGENT. 

It  is  supposed,  and  will  doubtless  be  conceded,  that  the  design 
of  the  government  and  institutions  of  the  United  States,  was  to 
establish  individual,  as  well  as  national  independence.  The  latter 
is  of  little,  may  be  of  no  value,  without  the  former.  The  most 
absolute  despotisms  on  earth  enjoy  national  independence.  It  was 
individual,  private,  and  personal  rights  which  the  fathers  of  the 
American  Revolution  fought  and  shed  their  blood  for ;  and  for 
none  more  especially,  more  distinctly,  or  more  emphatically,  than 
that  the  people  should  not  be  taxed  without  representation.  In  this 
claim  was  involved  the  personal  right  of  every  man  to  the  enjoy- 
ment and  disposal  of  the  avails  of  his  own  industry  and  labor,  as 
also  his  protest  against  any  portion  of  them  being  taken  for  the 
uses  of  the  commonwealth,  without  his  consent  in  a  representative 
capacity.  By  the  establishment  of  this  principle,  at  great  hazard, 
and  at  the  cost  of  much  blood  and  treasure,  personal  or  individual 
as  well  as  national  independence  was  acquired.  This  was  a  sub- 
stantial independence,  and  from  that  time  to  this,  labor,  for  the 
first  time,  in  the  history  of  modern  society,  has  become  an  inde- 
pendent AGENT.  In  Europe,  it  was,  and  still  is,  the  agent  of 
POWER.  It  has  been  forced  into  this  latter  position  by  the 
system  of  European  economists. 

It  should  be  observed  that  labor  is  never  wdejiendent,  when  it 
has  no  alternative  ;  that  is,  when  it  is  not  strong  enough  in  its  own 
position  to  accept  or  reject  the  wages  offered  to  it  in  any  given 
case,  if  unsatisfactory,  and  when,  in  such  a  case,  it  can  not  turn 
away,  and  live  and  prosper.  When  it  can  do  this,  it  not  only  has 
a  voice  in  its  wages,  but  the  parties  in  contract,  the  employer  and 
the  employed,  stand  on  a  footing  of  equality.  This  principle  is 
equally  applicable  to  the  producer  of  commodities  of  any  descrip- 


LABOR.  285 

tion,  as  proprietor  of  a  farm,  workshop,  or  any  other  producing  es- 
tablishment, over  which  he  presides,  and  where,  perhaps,  he  labors 
with  his  own  hands,  as  to  him  who  works  for  hire.  The  time  has 
never  yet  been  in  the  history  of  the  United  States  as  an  indepen- 
dent nation,  when  labor  was  not  in  this  sense  an  ifidejie/ide?it 
agent — when  it  could  not  reject  an  unsatisfactory  offer,  and  yet 
live.  It  is  not  pretended  that  labor  has  been  able  to  dictate  its 
own  terms.  That  would  be  equally  improper  and  unjust,  as  for 
the  employer  to  do  it.  But  it  has  always  had  an  altervudve.  As 
a  last  resort  the  American  laborer  can  at  any  time  go  to  the  back- 
woods.    His  independence  is  never  necessarily  sacrificed.  / 

Tins  wide  back-woods  field  for  American  labor,  is  a  security  for\  / 
its  independence  for  ages  to  come,  if  not  for  ever,  which  no  Eu- 
ropean economist  could  ever  appreciate.  It  was  for  want  of  this 
light,  that  Maithus  stumbled,  and  all  his  followers  after  him,  not 
excepting  M'Culloch,  who  was  doubtless  influenced  by  the  theory 
of  Malthus.  The  European  economists  have  never  been  able  to 
see  how  labor  could  be  independent,  and  have  planned  their  sys- 
tem on  the  assumption  that  it  must  for  ever  remain  the  agent  of 
power,  and  be  satisfied  with  a  bare  subsistence. 

It  is  this  independence,  in  connexion  with  the  means  of  sup- 
porting it,  that  has  sustained  the  wages  of  American  labor,  and 
kept  them  so  far  above  the  rates  of  wages  in  Europe  and  other 
forei<2;n  countries. 

In  the  light  of  this  contrast,  the  condition  of  European  and  other 
foreign  labor  is  one  of  absolute  bondage.  In  the  first  place,  it  is 
for  the  most  part  deprived  of  ail  political  influence.  This  is  the 
primary  cause  of  its  misfortunes.  In  the  next  place,  and  also  for 
the  most  part,  it  has  no  voice  in  its  wages.  There  is  no  alternative 
left  to  it.  It  must  work  for  what  is  offered,  and  work  hard,  or 
perish  in  want;  and  the  wages  doled  out  are  measured  by  so  nice 
an  estimate  for  bare  subsistence,  as  to  be  often  insufficient  for 
that.  In  all  those  countries,  labor  is  the  agent  of  jiowcr.  Power 
dictates  its  wages,  controls  it,  enslaves  it ;  and  it  needs  but  a  little 
reflection,  in  connexion  with  what  has  already  been  said,  to  see 
that  this  difference  is  immense,  and  Immensely  important. 

Mr.  Malthus''s  theory,  that  population  tends  to  an  inconvenient 
and  self-destructive  augmentation,  solved,  as  was  supposed,  the 
great  problem  of  human  society,  as  it  had  existed  in  Europe  for 
so  many  centuries  —  as  in  all  history  it  has  to  a  great  extent  ex- 
isted— and  fully  justified  the  subjection  of  the  masses  to  the  ser- 


2S6  LABOR. 

vice  of  the  kw.  It  relieved  the  responsibility  for  the  genera!  op- 
pression of  mankind  so  much  as  not  only  to  excuse  the  offence, 
as  beini^  the  unavoidable  result,  the  imperative  decree  of  Provi- 
dence ;  but  it  transformed  the  oppressors,  in  the  very  act,  into  the 
character  of  benefactors  to  the  race.  Instead  of  any  fault  of  the 
few  who  lived  on  the  labor  of  the  many,  the  many  were  Jaid  under 
the  greatest  obligations  when  the  few  should  give  them  employment 
enough  for  subsistence — to  keep  soul  and  body  together.  With 
such  a  beautiful  solution  of  this  difficult  problem,  came  also  a  sat- 
isfaction of  the  public  conscience,  and  a  confirmation  of  all  the  other 
doctrines  of  the  European  system.  It  was  manifestly  much  easier 
to  pronounce  the  evils  of  society  no  evils,  than  to  apply  a  remedy; 
and  it  was  a  complete  vindication,  though  it  ought  to  have  been 
shocking  to  entertain  the  thought  that  God,  and  not  man,  was  re- 
sponsible for  them.  Such,  however,  seems  to  have  been  the 
result  of  jMr.  Malthus's  theory. 

But  the  opening  of  the  new  world,  and  the  migration  of  the 
oppressed  portions  of  mankind  to  this  quarter,  have  presented  a 
class  of  facts  which  falsify  this  theory,  and  nullify  its  conclusions 
—  facts  which  existed  at  the  very  lime  when  that  theory  was 
formed,  and  when  it  was  adopted  with  so  much  eagerness  to  bolster 
up  a  fallacious  system.  The  facts  are  simply  these  r  The  land  of 
the  American  continent  is  open  and  free  to  all,  and  there  never 
has  been  a  time,  and  probably  never  will  be- — it  certainly  is  not 
necessary  —  when  a  laboring  man  can  not  turn  away  from  the 
wages  offered  him  for  his  services  on  hire,  and  go  and  live  an  inde- 
pendent life  on  the  unoccupied  lands  of  the  countiy.  He  may 
there  be  the  proprietor  of  his  own  estate,  and  have  all  the  rent,  the 
profits  of  culture  and  of  his  labor,  to  himself.  It  is  this  chance, 
for  ever  existing,  which  for  ever  makes  American  labor  indepen- 
dent. 

The  importance  of  this  truth  can  not  be  overrated,  and  it  is  wor- 
thy of  very  particular  consideration,  since  so  much  depends  upon 
it.  It  is  manifest  that  the  European  economists  were  greatly  em- 
barrassed, in  view  of  the  state  of  society  with  which  they  were 
surrounded,  till  the  Malthusian  theory  came  to  their  relief — a  sad 
and  gloomy  prospect,  indeed,  for  the  masses  of  mankind.  But  it 
was  a  rescue  for  the  economists.  It  was  not  only  an  apology  for 
their  o-enerai  system,  but  an  apology  for  that  state  of  society  out 
of  which  their  system  grew.  In  the  order  of  nature,  land  was 
the  first  property,  and  the  products  of  its  culture  and  use  were  the 


LABOR.  287 

next.  The  land  belonged  to  the  king  ;  the  king  parcelled  it  out 
among  his  lords  —  hence  called  "  A///r//o/-Js  ;"  and  hence  the  use 
of  this  term  all  the  world  over.  The  advancements  of  civilization 
erected  on  this  basis  a  vast  superstructure,  and  the  principles  of 
the  basis  ran  up  through  and  pervaded  the  whole.  The  system, 
as  stated  by  the  European  economists,  could  always  be  reduced  to 
three  primary  and  fundamental  elements :  "  Rent,  profit,  and  wa- 
ges ;"  the  first  going  to  ti)e  lords,  or  the  superior  classes ;  the 
second  to  the  managers  of  their  estates ;  and  the  third  being  the 
subsistence  of  the  laborers.  "  To  determine  tiie  laws,"  says  Ri- 
cardo,  "  which  regulate  this  distribution,  is  the  principal  problem 
in  political  economy." 

But,  it  must  be  evident  to  every  reflecting  person,  tolerably 
acquainted  with  the  facts  and  state  of  society  in  these  two  great 
quarters  of  the  world,  Europe  and  America,  that  the  three  things 
above  named  as  the  fundamental  elements  of  public  economy  in 
Europe,  do  not  exist  in  the  United  States  —  are  not  to  be  found 
here,  either  in  form  or  fact,  so  as  to  make  a  common  basis  of  a 
common  system.  As  the  two  last  grow  out  of  the  first,  and  as  the 
first  does  not  exist  in  this  country  in  any  shape  whatever,  to  an 
extent  sufficient  to  constitute  an  element  of  public  economy,  it  is 
manifest,  that  the  other  two,  following  from  the  first,  must  be  want- 
ing also.  Inasmuch,  therefore,  as  there  can  not  possibly  be  a  com- 
mon basis,  there  can  not  be  a  common  system. 

Under  the  European  system  labor  is  forced  into  service.  It  has 
no  alternative  —  no  choice.  It  must  work  on  the  terms  offered, 
or  starve.  It  is,  therefore,  proper  to  say,  as  is  the  fact,  that  labor 
there  is  the  agent  of  power.  And  in  this  phrase,  agent  of  power, 
in  such  an  application,  it  should  be  observed,  is  involved  a  principle 
—  a  principle  of  great  and  profound  significancy,  and  of  potent  in- 
fluence. The  power  that  is  thus  usurped,  is  the  dominant  power 
of  the  European  world.  It  may,  perhaps,  be  supposed,  that  the 
European  economists  could  not  see  how  it  was  possible  for  labor 
to  be  free,  independent,  and  have  a  voice  in  the  terms  of  its  ser- 
vices. In  the  state  of  society  that  existed  around  them,  and  as  far 
as  their  vision  extended,  they  could  see  nothing  for  labor  but  the 
doom  o(  a/orced  service  —  a  service  forced  by  stern  necessity,  viz., 
that  of  subsistence.  It  was  natural,  therefore,  that  they  should  make 
no  other  provision  for  it  in  their  system,  and  they  never  did  make 
any  other.  They  could  not  see  so  far  as  to  discover  what  new 
light,  the  new  experiments  in  the  western  hemisphere,  would  bring 


288  LABOR. 

to  this  o-reat  theme ;  though,  if  the  ahstract  proposition  had  heen 
considered,  they  migiit  easily  have  seen,  that  labor  would  rise  to 
independence,  the  moment  it  should  be  put  beyond  the  grasp  of  a 
forced  service.  But  it  is  not,  perhaps,  strange,  that  they  could  not 
foresee  this  from  their  remote  position,  when  it  is  scarcely  under- 
stood even  by  those  who  are  planted  in  the  midst  of  the  scene,  and 
are  perfectly  aware  of  the  fact.  How  few  of  the  most  reflecting 
men  in  the  United  States,  of  the  most  erudite  scholars  even,  or  of 
the  most  profound  statesmen,  ever  think  of  the  influence  and 
power  of  that  political  element  which  consists  in  the  fact,  that  every 
American  laborer  can  go  into  the  backwoods  whenever  he  pleases, 
and  live  a  perfectly  independent  life?  Thousands,  the  great  ma- 
jority, may  be  averse  to  such  a  resort ;  but  some  go,  all  can  go, 
and  they  all  know  the  field  is  open  before  them.  Ever  since  the 
western  shores  of  the  Atlantic  were  first  touched  by  the  feet  of 
European  emigrants,  the  tide  of  population  has  been  penetrating 
the  heart  of  the  American  continent,  without  meeting  with  any 
landlord  to  demand  rent,  or  with  any  manager  of  his  estates,  to 
absorb  the  profits  of  their  enterprise.  No  kings  had  gone  before 
to  parcel  out  the  territory  among  the  few  and  lordly  supporters  of 
their  thrones  ;  or,  so  far  as  that  had  been  done,  these  royal  patents 
were,  for  the  most  part,  nullified  by  the  result  of  the  American 
revolution.  The  way  westward  has  always  been  open  and  free  to 
all,  and  is  still  open  and  free.  A  man  has  only  to  push  on  a  step 
farther  than  his  predecessors,  and  set  up  his  stakes.  From  that 
moment  he  has  a  home,  is  lord  of  his  own  estate,  and  by  industry 
and  economy  may  be  independent  of  all  the  world.  Such  is  the 
actual  movement,  and  such  the  practical  operation  of  American 
society.  It  always  has  been,  and  always  is,  moving  on,  and  ex- 
tending its  limits,  by  the  impulses  of  freedom,  and  the  natural  de- 
sire for  independence.  Like  the  undulations  of  the  deep,  wave 
follows  wave,  and  it  is  all  one  great  sea.  All  is  composed  of  the 
same  elements,  and  all  is  afi'ected  by  the  same  influences.  They 
who  stay  behind  in  the  original  centres  of  civilization,  are  as  free 
as  those  who  range  on  its  outmost  borders  ;  that  is  to  say,  their 
services,  if  they  work  on  hire,  are  no  more  forced  than  those  of 
the  western  forester.  Both  work  for  independence,  aspire  to  it, 
enjoy  it ;  and  each  has  it  according  to  his  own  taste. 

It  is  this  constant  movement,  this  constant  tendency  to  move,  and 
this  knowledge  that  it  is  always  in  every  one's  power  to  move,  into 
such  a  field,  which  constitute  the  independence  of  American  labor, 


/■ 


LABOR.  289 

and  make  it  an  independent  agent,  as  opposed  to  the  position 
of  European  labor  which  is  the  agent  of  power.  The  latter  is 
a  forced,  while  the  former  is  a  free  and  unconstrained,  service  ; 
one  is  serving  masters,  while  the  other  is  working  for  one's  self. 

This  is  not  only  a  political  element,  considered  as  a  power  in 
the  state ;  but  it  is  an  element  of  public  economy,  considered  as  a 
cause  of  public  and  private  wealth- 
Starting  wjth  the  rights  of  independence,  as  defined  in  the  fore- 
going remarks,  the  American  laborers  aspire  to  the  improvement 
of  their  condition,  to  add  to  their  property,  to  accumulate  com- 
mercial values,  to  get  rich,  to  become  wealthy,  and  to  rise  in  the 
world.  According  to  the  declared  principles  of  American  society, 
which  are  well  known  to  all,  from  the  first  start  in  life,  and  in  all 
its  stages,  there  is  no  honor,  no  trust,  no  place  of  power  and  in- 
fluence, from  which  an  American  citizen  is  excluded  by  birth  ;  and 
so  far  as  the  stepping-stones  to  distinction  and  eminence  are  made 
to  depend  on  property  and  wealth,  these,  too,  though  a  man  begin 
the  world  wiih  nothing,  are  placed  within  the  reach  of  every  indus- 
trious, frugal,  and  enterprising  citizen.  Labor,  as  capital,  in  thef 
United  States,  is  generally,  if  not  universally,  worth  fifty  per  cent.l 
on  itself.  That  is  to  say,  a  frugal  laborer  can  easily  lay  up  half  of  ' 
his  wages,  which  of  itself,  in  all  his  savings,  becomes,  by  properi  / 
investment,  a  productive  capital  —  a  nucleus,  a  foundation  of 
wealth.  The  cumulative  power  of  his  labor  and  of  his  acquisitions, 
is  very  great,  if  well  husbanded  ;  and  the  country  is  full  of  ex- 
amples of  men  risino;  from  notl)in<j  and  from  the  humblest  con- 
dition,  to  great  wealth,  and  to  the  highest  stations  of  honor  and 
trust.  Such  are  the  goals  of  American  industry  and  enterprise, 
from  no  one  of  which  is  any  man  necessarily  excluded,  by  any  law 
of  society,  however  low  may  have  been  his  starting  point,  however 
humble  his  birth. 

This,  as  will  be  seen,  is  a  perfect  contrast,  the  direct  opposite, 
of  the  condition  and  prospects  of  the  European  laboi  ing  classes.  No 
provision  is  made  for  them,  but  that  of  bare  subsistence.  It  is  not 
intended  or  expected  that  laborers  there  should  better  their  con- 
dition, and  rise.  They  neither  hope  nor  strive  for  it.  They  are 
born  like  cattle  to  be  fed  and  worked ;  and  the  plan  of  society  and 
of  the  economists,  is,  to  get  as  much  work  out  of  them  as  possible. 
But  the  plan  of  American  society  is  to  give  to  all  classes  equal 
chances;  that  of  European  society,  to  maintain  the  distinction  of 
classes,  and  never  to  allow  one  to  be  merged  in  another,  or  all  in 

19 


290  LABOR. 

one.  In  Europe,  as  a  general  rule,  a  man  is  born  to  his  condition, 
high,  middle,  or  low.  In  the  United  States  a  man  makes  his  con- 
dition, and  there  is  no  obstacle,  but  his  own  lack  of  will  and  enter- 
prise, or  delect  of  natural  endowments,  in  the  way  of  his  acquiring 
wealth,  and  gaining  the   highest  consideration  in  the  community. 

The  cause  of  the  difference  between  the  wages  of  American  and 
the  wages  of  foreign  labor,  and  between  the  value  of  American  and 
that  of  foreign  capital,  is  political,  and  clearly  revealed  in  the  forego- 
ing statements.  The  high  position  of  American  labor,  is  the  award 
of  freedom  ;  the  wages  of  American  labor,  are  freedom-wages  ;  they 
are  true  and  just;  and  when  they  fall,  it  will  only  be  because  free- 
dom has  fallen.  The  high  value  of  American  capital,  is  a  freedom 
value;  and  when  that  shall  be  brought  down  to  a  common  level 
with  capital  in  Europe  and  elsewhere,  freedom  will  be  buried  in 
the  overthrow.  High  wages,  and  a  high  value  of  every  species  of 
property,  as  compared  with  those  of  Europe,  are  identical  with 
freedom.  The  spirit  of  man  falls  with  his  wages — with  the  reward 
of  his  industry,  toil,  and  care.  Crush  the  latter,  and  he  is  crushed. 
Possibly  he  may  rise  from  the  impulse  of  despair,  and  make  a  new 
effort.  He  may  succeed ;  but  the  chances  are  against  him.  Who 
can  break  the  yoke  on  the  neck,  and  the  chains  on  the  hands  of  the 
labor  of  Europe,  and  of  other  portions  of  the  world  ?  Can  the  op- 
pressed break  them?  —  No.     Will  the  oppressors  do  it?  —  No. 

The  power  of  governments  which  oppress  labor  is  immense, 
arising  from  this  source,  at  home  and  abroad,  in  moral  and  physical 
means.  Suppose  that  two  thirds  of  the  fair  reward  of  the  labor  of 
Europe  is  extorted  and  appropriated  by  its  kings,  princes,  courts, 
nobility,  gentry,  and  manufacturing  and  commercial  millionaires. 
Two  thirds  of  a  fair  value,  is,  in  fact,  about  the  average  proportion 
of  deprivation  of  right,  which  is  perpetrated  on  the  labor  of  that 
part  of  the  world  by  the  classes  above  named.  It  will  be  seen,  that 
such  a  fraction  of  the  rightful  reward  of  the  labor  of  Europe,  or 
twice  as  much  as  it  actually  realizes,  is  an  immense  power.  It  is  a 
great  power  in  any  single  state,  nation,  kingdom,  or  empire.  No 
small  portion  of  this  goes  into  the  public  exchequer,  to  be  disbursed 
for  the  augmentation  and  exertion  of  power.  It  is  all  appropriated 
directly  or  indirectly  for  these  objects.  The  adjuncts  and  props 
of  power  are  an  essential  part  of  it.  The  nobility  that  surrounds 
a  throne,  is  one  of  its  chief  supports.  All  wealthy  proprietors  of 
land  or  other  capital,  rich  manufacturers,  rich  merchants,  and  gen- 
try, have  their  security  in  the  stability  and  strength  of  the  govern- 


LABOR.  291 

ment,  and  can  afford  to  contribute  largely  from  their  large  incomes 
derived  from  oppressed  labor,  for  the  support  of  the  government 
which  protects  tiiem.  A  crown  is  usually  wealthy  in  itself,  and 
costly  to  the  people  ;  a  throne  is  costly ;  a  nobility  is  wealthy, 
and  its  income  great ;  wealthy  proprietors  of  land,  great  man- 
ufacturers, rich  merchants,  rich  tradesmen,  rich  bankers,  rich 
holders  of  funded  capital,  rich  gentlemen,  and  a  variety  of  classes 
coming  under  the  category  of  rich- — all  occupy  a  position  in  a  state 
of  society  where  labor  is  oppressed,  that  is  interested  in  the  sup- 
port of  power,  and  in  the  depression  and  hard  fate  of  the  laboring 
classes.  The  power  that  keeps  them  down  is  sustained  by  robbing 
them  of  the  reward  of  their  toil.  They  have  neither  the  spirit  to 
assert,  nor  the  means  of  vindicating,  their  rights. 

But  the  power  thus  derived,  is  not  only  efficacious  at  home,  to 
sustain  itself,  but  it  is  influential  abroad,  to  diffuse  itself.  It  is  mor- 
ally influential,  by  its  political  connexions,  in  extending  and  forti- 
fying the  empire  of  its  principles;  and  physically  so,  if  needs  be, 
in  propagating  them  by  the  force  of  its  arms.  It  can  afford  sacri- 
fices, in  expectation  of  a  valuable  return,  which,  as  is  seen  by  the 
parties  concerned  in  such  cases,  will  in  the  end  yield  ample  indem- 
nification. 

This,  as  shown  in  another  chapter,  has,  for  nearly  a  century, 
been  the  policy  of  Great  Britain,  in  the  advocacy  of  Free  Trade, 
not  to  practice  it  herself,  but  to  persuade  other  nations,  especially 
the  United  States,  to  do  it,  by  providing  them  with  the  argument 
of  Adam  Smith  and  those  of  his  school,  on  this  point.  It  is  shown, 
in  the  chapter  here  referred  to,  that  this  argument  is  a  contrivance 
of  the  British  government,  and  that  it  has  been  sustained  by  them, 
ever  since  those  British  authors  began  to  write  on  the  side  of  Free 
Trade. 

All  other  interests  of  civilization,  as  before  shown,  having  a  com- 
mercial value,  are  indebted  to  labor  for  that  value.  A  thins:  of 
commercial  value  can  only  be  exchanged  for  money,  or  for  a  quid 
pro  quo  that  is  prized  hy  money.  There  are  privileges,  rights,  and 
affections,  in  the  social  state,  which  can  not  be  thus  prized — which 
are  indeed  priceless.  These,  too,  are  the  fruits  of  care  and  pains, 
public  and  private,  except  such  as  are  the  spontaneous  product  of 
nature,  which  are  also  susceptible  of  improvement  by  culture.  But 
they  are  too  sacred  to  be  classed  among  things  of  commercial  value. 
Though  they  may  have  cost  money,  they  can  not  be  exchanged 
for  it. 


292  LABOR. 

But,  it  will  be  found,  that  all  things  of  a  proper  commercial 
value,  are  usually  the  products  of  labor.  Accident,  or  good  luck, 
may  put  a  person  in  possession  of  a  valuable  exchangeable  com- 
modity, that  cost  little  or  no  trouble.  But  such  exceptions  do  not 
impair  the  general  rule.  Labor,  therefore,  in  civilized  society,  oc- 
cu])ies  an  elevated,  important,  commanding  position  —  a  position 
that  supplies  the  wants  of  man,  and  gratifies  his  desires.  It  may, 
therefore,  justly  be  denominated  the  great  Interest  of  civilization. 
But  labor  is  especially  the  great  interest  of  the  American  people. 
This  republican  empire  was  founded  on  labor,  and  was  intended  to 
be  sustained  by  it.  The  fathers  of  the  country  were  working  men. 
The  mothers  and  their  daughters  worked.  They  claimed  the  right 
of  supplying  their  own  wants,  by  their  own  arts,  industry,  and  toil. 
This  right  was  denied  by  the  mother-country.  They  asserted  it 
by  force,  and  acquired  it  by  victory.  The  policy  of  their  oppres- 
sors was  to  keep  the  wages  of  American  labor  down  to  the  Euro- 
pean level,  by  prohibiting  the  manufacturing  arts  and  profitable 
commerce,  and  by  confining  the  people  of  the  colonies  to  as  few 
vocations  as  possible,  chiefly  agricultural,  thus  making  and  holding 
them  df-pendnit.  The  great  object  of  the  American  revolution  was 
to  vhdUale  the  rights  of  lnhor,  which,  with  the  American  fathers, 
comprehended  all  other  valuable  rights. 

Therefore,  the  rights  of  labor  are  polifical.  And  they  are  polit- 
ical in  relation  to  a  foreign  state  of  political  society  to  which  they 
are  opposed.  This  is  a  great  practical  point  of  this  subject,  which 
claims  special  attention  and  the  gravest  consideration. 

That  state  of  political  society,  to  which  the  rights  of  American 
labor,  as  acquired  in  the  establishment  of  American  independence, 
are  opposed,  and  which  is  for  ever  hostile  to  these  rights,  is  that 
already  referred  to  in  European  nations  —  it  may  be  found  else- 
where—  which  always  has  kept,  and  still  keeps  down  the  wages 
of  labor  to  a  bare  subsistence,  the  average  of  which  is  not  more 
than  one  third  of  its  fair  reward.  This  is  the  state  of  society  on 
which  European  systems  of  political  econoiny  are  founded,  which 
gave  birth  to  them,  which  they  are  designed  to  perpetuate,  not  even 
meditating  any  change  in  favor  of  labor;  and  labor,  in  those  sys- 
tems, is  a  principal  and  fundamental  element.  The  consequence 
is  a  political  result,  originally  the  cause  —  a  seeming  paradox,  that 
a  thing  should  be  father  to  itself — a  result,  planned  by  those  who 
framed  and  who  maintain  the  system,  viz.,  that  the  working  classes 
live  and  die,  as  they  were  born,  poor  and  dependent.    It  is  impos- 


LABOR.  293 

sible  it  should  be  otherwise,  in  such  a  state  of  things.  The  laboring 
classes  have  no  chances  to  improve  their  condition,  and  to  rise  ;  it 
is  not  intended  they  should.  They  have  no  pride,  no  courage,  no 
ambition,  no  hope.  These  sentiments  are  extinguished  by  the  se- 
verity of  their  doom.  They  were  born,  they  live  and  die,  slaves 
to  political  tyranny. 

In  the  meantime,  American  political  society,  founded  on  the  rights 
of  labor,  has  grown  up  —  has  established  itself — has  secured  to  la- 
bor a  fair  reward  —  and  the  practical  operation  of  it  has  demon- 
strated to  the  world,  that  any  man,  though  born  poor,  may  die  rich  ; 
and  that  his  personal  qualities,  and  not  his  birthright,  give  him  con- 
sideration in  society. 

In  the  meantime,  also,  that  old  political  system,  which  depresses 
labor,  and  holds  it  in  bondage,  has  maintained  and  fortified  its  po- 
sition ;  though  it  has  changed  its  mode  of  warfare  against  the  rights 
of  labor,  it  has  not  given  up  the  contest ;  what  it  could  neither  ar- 
rest, nor  subdue,  by  force  of  arms,  it  has  undertaken  to  conquer  by 
policy  ;  and  the  great  political  contest  of  the  age  is,  whether  the 
RIGHTS  OF  LABOR,  as  established  on  American  soil,  and  nourished 
by  American  blood,  shall  be  maintained,  and  extend  their  empire; 
or  whether  they  shall  be  crushed  by  political  devices  —  no  man 
rising  to  say  he  will  die  for  them  —  and  the  world  fall  back  to  where 
it  was  two  centuries  ago. 

This  strife  consists  in  the  array  of  die  money  and  labor  of  Europe, 
as  producing  powers  —  of  the  money  and  labor  of  all  those  coun- 
tries with  which  we  have  commercial  intercourse,  the  averao-e 
joint  value  or  cost  of  which  is  one — against  the  money  and  labor 
of  the  United  States,  as  opposing  producing  powers,  the  average 
joint  value  or  cost  of  which  is  two.  It  needs  no  prophet  to  pre- 
dict the  result.     In  a  contest  of  arms,  one  may  chance  to  beat  two 

—  a  small  force  may  rout  a  much  larger  one.  But  in  the  peace- 
ful pursuits  of  trade,  a  merchant  can  never  stand  before  a  rival  in 
the  same  market,  who  can  afford  to  sell  cheaper — and  a  good  deal 
cheaper.  The  case  settles  itself,  and  the  result  is  an  absolute  cer- 
tainty. / 

The  wages  of  labor  in  Europe,  and  in  other  countries  foreign  toV 
the  United  States,  have  been  kept  down  by  oppression  —  by  force 

—  and  money,  and  all  capital,  derived  from  it,  cost  in  proportion 
to  what  is  paid  for  labor.  The  wages  of  labor  in  the  United  States, 
as  the  result  of  political  freedom,  have  risen  to  three  for  one  of  la- 
bor in  Europe;  and  money,  and  all  other  capital  here,  cost  in  pro- 


294  LABOR. 

portion.  Now,  it  is  proposed,  by  Free  Trade,  to  put  the  products 
of  the  money  and  labor  of  the  United  States  in  open  conipetition 
with  the  products  of  the  money  and  labor  of  Europe.  Does  not 
every  one  see  what  will  be  the  result,  and  that  American  labor 
must  come  down  to  the  same  price,  before  it  can  compete  with 
the  labor  of  Europe  ?  In  other  words,  that  European  policy  and 
oppression  shall  govern  the  prices  of  American  labor?  Such  is 
the  question,  and  such,  on  a  Free-Trade  platform,  must  be  the  re- 
sult, unless  it  can  be  shown,  that  men  will  give  two  for  that  which 
they  can  buy  for  one,  or  for  one  and  a  half,  or  for  one  and  three 
fourths,  or  for  07ie  and  nine  tenths.  No  matter  what  the  difference 
is,  they  who  can  sell  lowest,  will  have  the  market. 

It  must  be  seen,  that  this  is  an  infallible  commercial  principle, 
destined,  everywhere  and  in  all  cases,  to  control  results,  on  the 
basis  of  Free  Trade.  It  does  not  follow,  however,  that  foreigners 
will  sell  us  cheaper,  as  a  matter  of  course,  in  the  long  run.  They 
will  do  it  only  to  gain  and  hold  the  market;  and  we  shall  yet 
show,  that  a  Free-Trade  system  is  the  most  costly  to  the  people 
of  the  U  nited  States,  even  in  the  very  things  proposed  to  be  ob- 
tained cheaper  by  it ;  much  more  in  the  general  result. 


COST  OF  MO.VEY  AND  LABOR  IN  EUROPE  AND  U.  STATES.  295 


CHAPTER    XIX. 

THE  DIFFERENCE  BETWEEN  THE  COST  OF  MONEY  AND  LABOR 
IN  EUROPE  AND  THEIR  COST  IN  THE  UNITED  STATES,  AS 
IT    AFFECTS    PUBLIC    ECONOMY    FOR    THE    UNITED    STATES. 

The  comparatrve  Prices  of  Labor  in  Europe  and  the  United  States — These  Prices  deter- 
mine the  Value  of  Money  and  other  Capital  in  these  two  Quarters — Money  worth 
more  ihan  other  Capital. — Its  Value  in  any  Country,  and  at  any  given  Time,  determined  X/^ 
by  the  Rate  of  Interest. — Some  Account  of  the  Rates  of  Interest  in  different  Countries, 
and  at  different  Times. — The  Average  Interest  of  Money  in  the  United  States,  as  com- 
pared with  the  Average  in  Europe. — Difference  in  tlie  joint  Cost  of  Money  and  Labor 
in  these  two  Q,uari€r8 — Different  Slates  of  Society  the  Caosesof  this  Difference. — The 
Greatness  of  the  Power  acquired  in  Europe,  by  the  Wrongs  to  Labor. — The  practical 
Importance,  in  forming  a  System  of  Public  Economy  for  the  United  States,  of  consid- 
«ring  the  Difference  in  tlie  Co.st  of  Money  and  Labor  in  Europe  and  America. — A 
Commercial  Principle  lies  at  the  Bottom  of  this  Difference,  and  controls  Results. 

The  Statistics  of  the  prices  of  labor  in  the  United  States  and 
in  Europe,  are  so  often  cited,  as  to  cause  it  to  be  universally  and 
well  known,  that  the  difference  in  these  two  quarters  is  very  great. 
Taking  the  average  of  prices  in  Europe,  it  has  been  found  that 
they  are  less  than  one  third  of  the  average  prices  in  the  United 
States,  for  the  same  descriptions  of  labor.  For  the  purposes  we 
have  in  view  in  this  work,  therefore,  we  assume,  whenever  there  is 
any  occasion  to  refer  to  it,  that  the  average  price,  cost,  or  value  of 
American  labor,  is  as  three  to  one  of  the  average  price,  cost,  or 
value  of  European  labor. 

Labor  being  the  parent  of  all  other  kinds  of  capital,  as  before 
shown,  it  will  follow  that  the  cost  of  everything  which  it  creates  is 
measured  by  its  price.  Adam  Smith,  Ricardo,  and  others,  have 
set  up  labor  as  the  measure  of  all  values.  Smith  is  so  earnest  on 
this  point,  that  he  takes  pains  to  show,  that  money  is  not  the  meas- 
ure of  value,  as  some  say  it  is,  but  that  labor  discharges  that  func- 
tion. We  agree  with  him,  that  money  does  not ;  and  we  are  not 
disposed  to  make  any  controversy  with  his  position  that  labor  does, 
if  he  means  only  to  assert  a  general  principle,  that  labor  influences 
prices,  causing  an  approximation  toward  an  agreement  in  prices 
with  a  given  amount  of  labor;  but  we  shall  have  occasion  to  deny 
that  any  certain  reliance  can  be  placed  upon  labor  as  the  measure 
of  price,  and  to  maintain  that  supply  in  relation  to  demand,  in 


296     mPFERENCE  IN  COST  OF  MONEY  AND  LABOR 

every  given  case,  is  the  rule  that  controls  prices.  It  is  sufiicient 
for  our  present  purpose  to  say,  that  labor  is  the  measure  of  the 
cost  of  other  capital  ;  from  which  it  will  follow,  that,  as  the  aver- 
age price  of  labor  in  Europe  is  not  more  thim  one  third  of  its  av- 
erage price  in  the  United  States,  the  average  cost  of  all  the  capital 
which  in  these  two  quarters  labor  creates,  being  all  other  tlian  itself, 
can  only  be  in  the  same  ratio,  viz.,  as  one  in  Europe  to  tliree  in 
the  United  States. 

Money  is  the  product  of  labor  as  truly  as  any  other  capital,  and 
its  value  is  naturally  determined  by  it.  But  money,  as  a  species 
of  capital,  may  be  considered  as  worth  more  at  the  same  cost,  than 
other  kinds,  inasmuch  as  it  is  a  common  currency,  and  will  always 
purchase  all  other  kinds,  and  supply  wants  more  certainly  and 
more  conveniently  than  any  other. 

The  comparative  value  of  moaey,  in  different  quarters  of  the 
world,  and  at  different  times,  is  ascertained  by  the  comparative 
rate  of  interest  that  is  paid  for  it,  on  an  average,  as  a  subject  of 
trade.  Adam  Smith  states  that  under  Henry  VIII.,  interest  above 
ten  per  cent,  was  declared  unlawful ;'  that  it  was  reduced  to  eighfi 
per  cent,  under  James  I. ;  to  six  per  cent,  soon  after  the  restora- 
tion ;  and  to  five  per  cent  under  Queen  Anne.  It  has  gradually 
fallen  since  that  time ;  and  money  was  borrowed  by  the  British 
government,  in  the  old  French  war,  as  we  call  it  here,  at  three 
per  cent.  Holland,  in  the  time  of  Adam  Smith,  some  70  to  80 
years  ago,  borrowed  at  two  per  cent.,  as  her  credit  was  at  the  high- 
est point ;  and  her  private  citizens  borrowed  at  three  per  cent* 
Legal  interest  in  France,  in  the  earFy  part  of  the  ISth  centurj'^ 
fluctuated  from  five  to  two  per  cent. 

It  is  true,  that  these  laws  against  usnry  prove  no  more  than  that 
interest  was  exacted  at  higher  rates  than  the  law  allowed,  and  that 
these  legal  reductions  followed  in  the  train  of  the  market  reductions-. 

There  have  been  times  and  countries  in  which  the  interest  of 
money  was  so  high  as  to  be  now  almost  incredible.  It  appears  by 
the  letters  of  Cicero,  that  Brutus  loaned  money  at  forty-eight  per 
cent,  in  the  latter  days  of  the  Roman  republic  ;  and  Adam  Smith 
states  that  forty,  fifty,  and  sixty  per  cent,  had  been  paid  for  the  uso 
of  money,  by  farmers  of  estates  in  Bengal,  and  the  crops  mort- 
gaged to  secure  principal  and  interest,  so  great  were  the  profits- 
It  has  happened,  for  very  short  periods,  when  money  was  tight, 
and  much  was  at  stake,  that  interest  as  high  as  the  highest  of  the 
above  rates,  has  been  paid  in  the  city  of  New  York.     But  it  is  not 


IN    EUROPE    AND    IN    THE    UNITED    STATES.  297 

these  exorbitant,  accidental,  and  transient  rates  of  interest,  but  the 
general  average,  in  a  course  of  years,  that  determines  the  value  of 
money,  as  a  subject  of  trade,  in  different  quarters  of  the  world. 

The  use  of  money  is  bought  and  sold  in  market,  like  anything  ^7 
else,  and  the  rate  of  interest  is  its  price.  That  is  to  say,  when  the 
average  rate  of  interest  in  one  country  is  6  per  cent.,  and  in  another 
3  per  cent.,  the  value  of  money  is  twice  as  much  in  the  former  as 
in  the  latter,  or  two  to  one.  The  same  rule  is  applicable  to  the 
variations  of  interest  in  the  same  country  at  different  limes.  Adam 
Smith  has  laid  down  this  rule  very  clearly  in  the  following  terms  : 
*'  Whatever  are  the  causes  which  lower  the  value  of  capital,  the 
same  must  necessarily  lower  that  of  interest,  and  exactly  in  the 
same  proportion.  The  proportion  between  the  value  of  capital  and 
that  of  interest,  must  remain  the  same."  There  may  be  transient 
exceptions  to  this  rule,  from  either  a  temporary  scarcity  or  plenty  of 
money  in  market;  or  more  properly,  perhaps,  from  the  difficulties 
or  facilities  of  obtaining  it. 

The  following  table  of  the  rates  of  discounts  in  London,  for  the 
last  twenty  years,  on  first-class  paper,  by  finding  the  account  of  the 
same  firm,  doing  business  through  the  same  brokers,  for  that  period, 
was  furnished  by  a  London  correspondent  of  the  New  York  Courier 
and  Enquirer  : — 

January,  1828 3     percent.     January,  1838 3J  percent. 

July,  do 2^  percent.     July,         do 3     percent. 

January,  1829   3^  per  cent.     January,  1839 Sj  per  cent. 

July,  do 3i  percent.     July,  do 5|  percent. 

January,  1830 3     percent.     January,  1840 6     percent. 

July,  do. 3     percent.     July,  do 4^  percent. 

January,  1831 3|  per  cent.     January,  1841 5     per  cent. 

July,  do 4     percent.     July,  do 5     percent. 

January,  1832 3|  percent.     January,  1842 41  percent. 

July,  do 3i  percent.     July,  do 3|   percent. 

January,  1833 2^  percent.     January,  1843 2f  percent. 

July,  do 25  per  cent.     July,         do 2    percent. 

January,  1834 3;  percent.     January,  1844 2     percent. 

July,  do 3^  percent.     July,  do 3^  percent. 

January,  1835 3^  percent.     January,  1845 2^  percent. 

July,  do 3i  percent.     July,  do 2|  percent. 

January,  1836 3f   percent.     January,  1846. .  r 4^  percent. 

July,  do 4     percent.     July,  do 4     percent. 

January,  1837 4^  per  cent.     January,  1847 4     per  cent. 

July,  do 4|  percent.     July,  do 5|  percent. 

The  medium  of  these  rates  is  about  3^  per  cent. 

The  interest  of  money  on  the  continent  of  Europe,  is  generally 
less  than  in  England.     If  we  put  the  rate  of  interest  in  Europe  at 


298  DIFFERENCE    IN    COST    OF    MONEY    AND   LABOR 

3  per  cent.,  and  that  in  the  United  Ptates  at  6  percent.,  it  is  prob- 
ably a  fair  exhibit ;  as  the  latter  as  often  and  as  much  exceeds  6  as 
the  former  exceeds  3.  It  would,  perhaps,  be  fair  to  say,  that 
money  is  worth  as  much  more  in  the  United  States,  than  in  Europe, 
as  labor  is.  The  difference  in  the  value  of  property  generally,  it 
might  perhaps  be  said  necessarily,  corresponds  nearly  with  this 
measure,  inasmuch  as  there  can  be  no  good  reason  why  the  per- 
manent capital  created  by  labor  should  fall  below  itself  in  value. 
But,  as  before  remarked,  money  capital  may  be  considered  as 
worth  more  than  other  kinds  at  the  same  cost,  it  being  always 
more  available  for  use  as  a  common  currency. 

It  will  be  seen,  therefore,  that  the  cost  of  money  in  the  United 
States  is  rated  very  low,  as  compared  with  its  cost  in  Europe,  if  the 
difference  be  allowed  to  be  as  two  to  one.  It  is  proposed,  however, 
in  tlie  general  argument  of  this  work,  to  allow  that  the  difference  is 
only  as  three  to  two,  which  is  a  sacrifice  in  the  force  of  our  argu- 
ment. 

It  will  be  seen,  therefore,  if  the  difference  in  the  price  of  labor 
in  Europe  and  the  United  States,  is  as  three  for  the  latter,  and  one 
for  the  former,  as  shown  above  ;  and  if  the  difference  in  the  cost  or 
value  of  money,  in  these  two  quarters,  be  assumed  as  three  to  two, 
that  the  joint  value,  or  cost,  or  price,  of  labor  and  money  in  Eu- 
rope and  the  United  States,  is  as  two  for  the  latter,  and  one  for  the 
former;  or  one  hundred  per  cent,  difference;  that  is  to  say,  money 
,_L  and  labor  together  cost  twice  as  much  in  the  United  States  as  they 
do  in  Europe.  The  true  difference  is,  in  fact,  considerably  in  ex- 
cess of  this. 

The  primary,  fundamental  cause  of  this  difference,  is  disclosed 
in  another  chapter,  viz.,  that  the  labor  of  Europe  is  held  in  a  state 
of  bondage,  and  forced  to  work  on  terms  prescribed  by  those  who 
in  fact  wield  the  power  of  masters.  Down  to  this  time,  labor  in 
Europe  has  always  been  kept  in  a  state  in  which  it  is  compelled  to 
toil  for  bare  subsistence.  The  reward  of  labor  as  a  compensation 
for  the  services  of  one  human  being  rendered  to  another,  both  of 
whom  are  assumed  to  be  on  a  footing  of  equality  by  nature,  and 
in  all  the  rights  of  the  social  state,  never  entered  into  the  policy  of 
the  states  of  Europe,  and  was  never  admitted  as  an  element  in  the 
systems  of  European  economists ;  but  it  has  always  been  carefully 
excluded  from  both.  The  principle  adopted  and  acted  upon  by 
both  —  by  one  in  the  promulgation  and  exposition  of  creeds  in 
their  abstract  forms,  and  by  the  other  in  carrying  them  out  in  the 


IN    EUROPE    AND    TN    THE    UNITED    STATES.  299 

practical  operations  of  government  —  has  been  such  a  provision  for 
labor  as  will  merely  perpetuate  the  race  of  laborers.  It  is  so  ex- 
pressed by  Adam  Pmith,  and  others  of  his  school,  in  terms,  as 
already  seen  in  another  chapter.  Nothing  has  ever  been  contem- 
plated, by  either  the  economists  or  governments  of  Europe,  ex- 
cept the  bare  subsistence  of  laborers,  that  they  may  render  the 
most  effective  service,  and  that  the  race  may  not  become  extinct  by 
deprivation  and  want,  in  the  same  manner  as  provision  is  made  for 
beasts  of  burden,  draught,  and  other  services.  The  principle  of  re- 
ward, of  compensation,  for  laboring  man,  was  never  thought  of  by 
them,  any  more  than  that  of  rewaiding  the  laboring  beast ;  and 
the  laboring  man  in  Europe,  for  the  most  part  —  in  all  that  regards 
the  principles  of  public  economy  there,  and  in  all  that  is  devised 
and  put  in  force  by  European  governments,  to  the  extent  of  their 
ability,  which,  unfortunately  has  too  much  control  in  the  premises 
—  has  no  more  to  do  in  fixing  the  measure  of  his  subsistence,  than 
the  laboring  brute.  It  is  public  economy  there  that  presides  over 
his  destiny,  and  political  power  that  controls  it. 

This  radical  and  fundamental  cause  runs  up  and  branches  out 
into  all  departments  of  European  society,  distributing  itself  in  a 
thousand  ramifications,  where  it  occupies,  in  these  respective  stages, 
the  position,  and  discharges  tlie  functions  of  mediate  or  intermedi- 
ate causes.  All  these  influences,  however,  have  but  one  origin, 
viz.,  that  principle  of  the  European  creed,  that  the  masses  were 
born  to  serve  the  k\v.* 

The  greatness  of  the  power  acquired  by  this  wrong  done  to  the 
labor  of  Europe,  and  the  parties  by  whom  it  is  appropriated,  are 
worthy  of  a  moment's  consideration,  in  addition  to  what  is  said  on 
this  point  in  the  preceding  chapter.  It  is  nothing  less  than  /wo  thirds 
of  the  fair  reward  of  labor  in  that  entire  portion  of  the  world,  if  it  be 
admitted,  as  will  certainly  be  maintained,  that  the  reward,  the  com- 
pensation obtained  by  American  labor,  is  a  just  compensation  — 
that  it  is  the  freedom  and  the  fair  price.  It  is  a  great  power  in 
any  single  state,  for  ever  increasing  in  a  sort  of  geometrical  ratio. 
"  A  great  stock  with  small  profits,"  says  Adatn  Smith,  "  increases 
faster  than  a  small  stock  with  great  profits.     Money,  says  the  prov- 

*  Of  course  it  will  be  understood  that  all  this  reasoning  is  predicated  on  the 
state  of  European  society  before  the  general  revolution  attempted  in  1848,  com- 
mencing at  Paris.  What  will  be  the  end  of  this  we  know  not;  but  the  sole  cause 
of  this  great  movement  is  the  condition  of  labor  above  described,  and  the  object 
of  this  revolution  is  the  restoration  of  labor  to  its  rights. 


300  DIFFERENCE    IN    COST    OF    MONEY    AND    LABOR 

erb,  makes  money.     When  you  have  got  a  little,  it  is  easy  to  get 
more.     The  great  difficulty  is  to  get  that  little."     Alas  for  the  labor 
of  Europe  !     It  has  much  to  do,  a  great  battle  to  fight,  "  to  get  that 
little."      Fortunate  for  the   masters  of  Europe  —  however  unfortu- 
nate for  mankind — that  they  have  got  all.     There  is  nothing  cre- 
ated by  the   labor  which  they  control,  which   does  not  come  into 
their  hands.     Hence  the  gigantic  structures  of  concentrated  power 
which   Europe  presents,  like   the  everduring  pyramids  of  Egypt, 
both  created  by  tlie  same  means,  the  command  and  control  over 
human  labor.     Hence  the  elevated  and  inapproachable  spheres  of 
portions  of  European  society,  walled  up  and  defended  by  innumer- 
able guards,  and  intrenched  by  every  conceivable  means  of  power. 
The  secret  of  all  these  fortified  and  impregnable  positions,  of  the 
affluence  and  pomp  in  which  a  small  portion  of  European  society 
moves,  and  of  the  power  with  which  they  are  surrounded,  is  the 
degradation   and  oppression  of  the   laboring    classes  —  depriving 
them  of  their  rights,  and  robbing  them  of  two  thirds  of  the  fair  re- 
ward of  their  toil  —  withholding  from  them  all  compensation  ;  for 
bare  subsistence  can  not,  in  any  propriety,  be  regarded  in  the  light 
of  compensation. 

It  is  power  thus  acquired,  which  supports  the  expensive  gov- 
ernments of  Europe;  whi(  h  maintains  its  armies,  its  navies,  its 
religious  establishments ;  which  fortifies  rank  in  every  position 
above  the  grand  substratum  of  labor  ;  which  entrenches  the  com- 
mercial millionaire  in  the  centre  of  his  vast  accumulations  ;  which 
endows  nobility  with  its  immense  estates,  and  with  its  high  pre- 
scriptive rights  ;  and  which  surrounds  and  protects  the  thrones 
from  which  emanates  the  authority  to  exercise  tliis  power.  There 
is  nothing  of  greatness,  of  power,  of  wealth,  of  distinction,  or  in  the 
forms  of  either,  as  exhibited  in  the  European  world,  which  is 
not  in  part,  in  a  very  large  part,  composed  of  the  wrongs  done  to 
labor.  This  is  as  inevitably  true  as  the  fact  that  labor  in  Europe 
is  deprived  of  two  thirds  of  its  fair  reward,  and  can  only  be  proved 
otherwise  with  the  disproof  of  this  fact. 

It  can  not  but  be  seen  that  the  bearing  of  this  difference  in  the 
cost  of  money  and  labor  in  the  United  States  and  Europe,  on  a 
system  of  public  economy  for  the  United  States,  is  direct,  potent, 
and  sweeping.  It  is  two  to  one  in  the  producing  powers  of  Eu- 
rope and  other  foreign  parts  against  the  producing  powers  of  the 
United  States,  it  being  assumed  that  money  and  labor  are  the  active 
powers  employed.     All  the  other  powers  which  lie  back  of  these 


IN    EUROPE    AND    IN    THE    UNITED    STATES.  '     301 

as  a  basis,  exist  in  a  like  proportion  of  force  in  these  quarters  rela- 
tive to  each  other.  It  is  a  practical  commercial  principle,  that  is 
now  under  consideration  —  a  principle  that  operates  uniformly  all 
the  world  over,  and  which  never  fails  to  he  enerjretic  in  accom- 
plishing  its  results.  It  is  the  principle  of  competition  in  trade. 
Every  merchant  in  New  York,  or  in  any  other  city,  or  in  any  other 
place,  knows,  that  he  can  not  stand  against  a  competitor,  who  can 
sell  goods  at  a  profit  for  less  than  what  his  goods  of  the  same  kind 
cost  him.  He  is  ruined  by  the  competition,  if  he  continues 
it.  The  principle  is  the  same  in  its  application  to  nations  as  to 
individuals. 

With  the  wide  margin  of  a  power  of  three  to  one  in  labor,  and 
of  three  to  two  in  money,  or  of  two  to  one  in  both,  in  favor  of  Eu- 
rope against  the  United  States,  it  must  be  seen,  that  a  small  fraction 
of  the  power  of  this  difference,  added  to  that  which  is  equal  to  the 
entire  power  of  the  United  States,  and  brought  skilfully  and  effec- 
tively to  bear  on  any  one  point  of  the  rival  interests  of  this  coun- 
try, will  crush  us  in  that  particular,  and  in  every  other  when  like 
attempts  are  made,  unless  we  have  an  American  commercial  sys- 
tem, such  as  is  described  in  another  chapter,  to  defend  us.  Eu- 
rope, of  course,  will  never  use  the  whole  of  the  power  of  this 
difference  against  us.  It  would  not  be  necessary  to  gain  her  end. 
A  fraction  of  it  will  do.  And  in  all  particulars  in  which  it  is  done, 
she  has  us  entirely  in  her  power,  and  may  command  her  own  prices 
for  all  that  we  are  thus  forced  to  buy  of  her.  It  is  in  this  way, 
that  we  pay  dearer  under  Free  Trade  than  under  Protection,  for 
the  same  articles,  besides  the  abstraction  of  the  cost  from  the  coun- 
try, and  the  suppression,  in  a  like  amount,  of  American  labor 
and  trade. 


302       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 


CHAPTER   XX. 

THE    CLAIMS    OF    AMERICAN    LABOR    FOR    PROTECTION. 

Difference  in  the  social  Position  of  Labor  in  Europe  and  America. — It  is  a  Commercial 
Principle,  that  requires  the  Protection  of  Amer  can  Labor,  and  therefore  imperative  — 
The  Rule  of  graduating  Protection— How  Foreign  Policies  bear  on  the  vulnerable 
Points  of  the  United  States. — British  Free  Trade  a  Protective  Policy. — The  Abatement 
of  Duties  in  Great  Britain  requires  Increase,  rather  than  Diminution,  in  the  United  States, 
because  it  is  made  for  Protection. — Importance  of  Skill  in  Public  Economy,  to  Amer- 
ican Statesmen. — The  Advantaf^es  of  l^ree  Labor  over  Slave  Labor. — European  Labor 
in  a  like  Position  witli  Slave  Labor. — The  best  Rule  for  Protection  is.  that  they  who 
ask  for  it,  should  have  it. — Adam  Smith's  Argument  for  Free  Trade,  is  One  for  Piotec- 
tion. — He  concedes  and  begs  the  Question. — Adam  Smith  and  Daniel  Webster,  as  to  the 
Effect  of  increased  Investments  of  Capital  in  proilucini;  E.-tabiishments  on  Liibor,  and 
on  the  Profits  of  Capital. — The  United  States  can  never  dispense  with  Protection,  so  long 
as  Money  and  Labor  here  co.-t  more  than  elsewhere. — The  Cry  of  "  Monopoly." — Dem- 
agogues. 

Labor  is  the  only  thing,  in  the  United  States,  that  requires  pro- 
tection ;  or  in  the  protection  of  labor,  all  thirigs  else  that  need  it, 
are  also  protected.  It  may  be,  and  doubtless  is,  otherwise  in  Eu- 
rope, so  long  as  they  propose  to  maintain  their  state  of  society. 

European  economists  have  never  invested  labor  with  the  attri- 
butes, nor  placed  it  in  the  position,  of  capital.  We  differ  from 
them  in  this,  not  only  by  doing  what  they  have  not  done  in  this 
particular,  but  by  making  it  the  parent  of  all  other  capital,  as  shown 
in  a  preceding  chapter.  What  they  call  capital,  and  which  is 
commonly  so  called,  is  placed  by  them,  not  only  first  as  to  the 
dio^nity  of  its  position,  but  first  and  chief  as  the  great  commercial 
agent  of  the  world.  Labor  is  thrust  by  them  into  an  abject  condi- 
tion, and  made  to  sustain  a  servile  relation  to  capital.  The  legisla- 
tion of  Europe  corresponds  with  this.  All  attempts  of  labor  there, 
particularly  in  Great  Britain,  by  association  and  combination,  by 
trades- unions,  and  by  strikes,  to  rise  and  assert  its  rights,  have 
always  been  visited  with  legal  penalties  for  their  suppression  ; 
whereas,  the  association  and  combination  of  capitalists  for  their 
mutual  advantage,  and  to  fortify  their  position  against  these  strug- 
gles of  the  laboring  classes,  are  not  only  tolerated,  but  legalized 
and  protected.  Enough  has  already  been  said,  in  former  chapters, 
to  show  the  degradation,  the  hard.<hips,  the  deprivations,  and  the 
miseries  of  European  labor.     Capital  is  the  great  thing  there  ;  la- 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       303 

bor  is  the  great  thing  here.  Capital  there  is  the  only  thing  thought 
of  in  the  institution  and  support  of  a  protective  system  ;  labor  here 
is  the  only  thing  that  requires  protection.  Capital  there  is  a  great 
political  power  ;  labor  here  occupies  that  position,  and  may  prop- 
erly be  called  the  great  power  of  the  country  ;  whereas,  labor  in 
Europe  has  little  or  no  power;  and  as  to  |)rotection,  it  has  none, 
but  is  made  the  slave  of  capital  —  is  the  slave  of  society.  In  Eu- 
rope the  fruits  of  labor,  that  is,  the  accumulations  of  commercial 
values,  have  been  wrested  from  the  hand  that  created  them,  and 
not  only  appropriated  to  the  use  of  the  spoilers,  but  is  employed  by 
them  to  force  the  producers  of  this  great  wealth  to  go  on  producing:, 
chiefly  for  the  benefit  of  those  who  have  done  the  wrong.  The 
producers  are  held  in  a  servile  relation  to  their  own  creations,  and 
by  the  application  of  misnomers  in  public  economy,  the  world  is 
made  to  believe,  that  capital  is  the  first  and  great  thing;  that  capi- 
tal occupies  the  position  of  the  mainspring  of  society  ;  and  that 
labor  is  indebted  to  capital,  the  work  of  its  own  hands,  to  save  it 
from  starving.  Thus  the  natural  order  of  things  is  reversed,  and 
the  fundamental  and  most  important  relations  of  human  society  are 
overturned.  By  the  studious  use  and  persevering  application  of 
misnomers  for  centuries,  and  by  the  general  consent  of  mankind,  a 
grand  heresy  to  nature  has  taken  the  place  of  her  own  teachings, 
and  acquired  the  authority  of  orthodox  belief,  by  default  and  weak- 
ness of  the  injured  party.  Nevertheless,  the  truth  of  the  case  only- 
lies  in  abeyance,  and  flashes  forth  in  full  blaze  the  moment  it  is 
challenged.  There  is  not  probably  a  reader  of  this  work,  who, 
though  he  may  never  have  thought  of  it  before,  though  he  may 
have  adopted  directly  the  opposite  opinion,  and  cherished  it  all  his 
life,  will  not  confess,  that  labor,  and  not  capital,  is  the  original  and 
fundamental  power  of  society  and  of  the  commercial  world  ;  that 
it  is  itself  capital,  and  the  parent  of  all  other  capital  —  the  parent  of 
all  commercial  values. 

We  proceed  to  observe,  that  it  is  a  commercial  principle  that 
invokes  Protection  for  American  labor.  And  because  it  is  so,  it 
can  not  err,  is  infallible,  imperative.  The  principle  grows  out  of 
the  facts  already  established,  to  wit,  that  the  average  cost  of  labor 
in  the  United  States  is  three  to  one  of  the  average  cost  in  Europe 
and  other  foreign  parts,  with  which  we  have  commercial  intercourse. 
It  has  been  shown,  indeed,  that  the  difference  is  greater  than  this ; 
but  this  is  sufficient  for  the  argument.  It  has  also  been  shown, 
that  the  value  or  cost  of  money,  and  of  all  other  capital,  in  the 


304       THE  CLAIMS  OF  AMERICAN   LABOR  FOR  PROTECTION. 

United  Plates,  is  in  the  same  proportion  greater  than  the  value  or 
cost  of  the  same  things  in  foreign  parts.  This  must  necessarily  be 
true,  because  every  species  of  property,  money  and  other,  is  bought 
by  labor,  is  its  product,  and  is  therefore  estiu)ated  by  the  cost,  or 
price,  or  quantity  of  labor.  But  inasmuch  as  money-capital  is  the 
common  currency  of  the  commercial  world,  it  is  allowed,  that  it  is 
fairly  worth  more  than  other  capital  in  proportion  to  its  cost ;  and 
notwithstanding  that  this  allowance  applies  equally  to  the  United 
States  as  to  foreign  parts,  it  is  nevertheless  proposed,  as  a  boon  to 
opponents,  to  rate  the  money  of  Europe,  in  this  argument,  as  tuo 
io  i/iicc  of  ibe  money  of  this  country,  in  its  cost,  and  consequently 
in  its  value.  'J'his,  as  before  determined,  makes  the  joint  cost  of 
money  and  labor  in  Europe  as  one  to  f.ivo  of  their  joint  cost  in  the 
United  States;  or  the  "difference  is  07>f;  /mmlnd  jx-r  ant.  in  favor 
of  Europe  against  the  United  States,  in  these  two  things  as  produ- 
cing powers  in  both  quarters. 

It  is  convenient  to  represent  these  two  agents  as  the  common 
producing  powers  in  combination  all  the  world  over,  inasmuch  as 
money  is  the  representative  of  every  other  species  of  capital  as  a 
common  currency  for  them  all;  and  inasmuch  as  money  and  labor 
are  the  agents  usually  brought  together  for  purposes  of  production. 
It  will  be  seen,  therefore,  on  these  premises,  as  before  shown,  that 
the  producing  powers  of  Europe  are  at  least  two  to  one  in  force  — 
they  are  in  fact  greater — against  the  producing  powers  of  the  Uni- 
ted States,  because  they  cost  only  half  as  much. 

Suppose  two  merchants  side  by  side  in  New  York,  or  in  any 
other  city  or  place,  trading  in  the  same  articles,  and  that  these  arti- 
cles cost  one  of  them  twice  as  much  as  they  cost  the  other.  Which 
has  the  best  chance  in  open  and  free  competition  ?  Which  will 
beat?  Which  will  fall  before  t!ie  other?  It  is  plain  enough,  that 
the  one  whose  articles  cost  twice  as  much  as  those  of  the  other, 
must  shut  up  shop.  He  could  not  stand,  even  though  the  differ- 
ence in  the  cost  of  his  articles  be  less  than  100  per  cent. ;  though 
it  be  50  ;  though  it  be  25  ;  though  it  be  10  ;  though  it  be  5  per 
cent.  If  there  be  a  vigorous  and  determined  competition,  he  might 
fall,  and  be  driven  out  of  the  market,  with  a  difference  of  2  or  1 
per  cent. ;  or  even  of  one  half-cent  per  cent.  Such  is  the  force 
and  effect  of  competition  between  private  persons  in  the  same  mar- 
ket ;  and  such  precisely  is  the  force  and  effect  of  competition  be- 
tween commercial  nations,  the  aggregate  of  whose  trade  with  each 
other  is  always  made  up  of  private  and  independent  transactions, 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       305 

as  in  the  case  above  supposed.  That  party  will  always  beat, 
which  can  afford  to  sell  cheapest,  by  reason  of  a  less  cost  of  the 
articles  broufrht  into  market. 

Thus,  from  the  operation  of  an  infallible  commercial  principle, 
which  never  varies  in  its  results,  and  which  can  not  lead  to  error, 
the  producing  powers  of  Europe,  which  cost  one,  must  inevitably, 
on  a  platform  of  Free  Trade,  overwhelm  the  producing  powers  of 
the  United  Stales,  which  cost  two,  and  drive  the  latter  from  the 
market  that  is  open  to  both  on  the  same  terms,  except  as  the  latter 
should  consent  to  trade  at  ruinous  prices.  In  either  case  it  would 
be  ruinous. 

The  importance  of  anticipating  our  opponents,  whenever  this 
point  is  presented,  must  be  our  apology  for  repeating  here,  as  we 
not  unfrequently  have  occasion  to  do,  that  we  are  aware  this  argu- 
ment may  be  seized  upon  as  an  admission,  that  Free  Trade  would 
cheapen  articles  to  consumers,  and  that  Protection  enhances  prices. 
But  we  have  shown  elsewhere,  as  often  remarked,  that,  while  the 
above  argument  is  sound  and  irrefragable,  this  conclusion  does  not 
follow;  and  that  European  and  other  foreign  factors,  once  admitted 
to  our  market  on  ihe  principles  of  Free  Trade,  always  raise  prices 
above  what  they  are  under  a  system  of  Protection,  as  soon  as  they 
get  possession  of  the  market  by  driving  Americans  out.     Wliile  it 
is  true,  that  without  Protection,  they  are  able  to  break  Americans 
down,  it  is  not  true,  that  having  broken  them  down,  they  will  con- 
tinue  to  sell  cheaper;    but  they  invariably  demand   and   realize 
higher  prices  than  those  which  prevail  under  a  protective  system ; 
so  that  t4ie  evils  of  Free  Trade  to  this  country  are  threefold:  First, 
by  destroying  a  part  of  the  business  of  the  people  and  preventing 
its  increase  ;  next,  by  raising  the  prices  of  the  articles,  the  domestic 
production  of  which  has  been  suppressed  or  prevented  ;  and  third- 
ly, by  banishing  specie,  to  the  amount  paid   for  them,  from  the 
country,  which  would  otherwise  be  retained  as  a  part  of  our  do- 
mestic wealth,  to  be  used  as  "tools  of  trade"  for  the  augmentation 
of  wealth.     This  last  evil  may  be  greater  or  less.    It  may  be  suffi- 
cient to  bankrupt  the  whole  country,  and  has  several  times  done  so, 
as  is  shown  elsewhere  in  this  work. 

We  proceed  to  consider  how  the  rule  of  protection  is  to  be 
ascertained,  and  on  what  principle  it  should  be  graduated.  At 
first  sight,  it  might  perhaps  seem  that  it  should  be  graduated  by  the 
difference  in  the  cost  of  money  and  of  labor  in  the  United  States 

20 


306       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

and  other  parts,  that  is,  one  hundred  per  cent,  or  more.  But 
when  it  is  considered  that  the  chief  aim  of  European  and  other 
forei"-n  o-overnments,  in  robbing  their  laboring  classes  of  an  average 
of  two  thirds  of  the  wages  which  they  are  justly  entitled  to  receive, 
as  a  freedom  value,  is  to  appropriate  it  to  their  own  use  and  bene- 
fit ;  or  rather,  that  society  in  those  quarters  is  constituted  with  the 
desi"-n  of  having  this  two  thirds  of  the  fair  wages  of  labor  absorbed 
by  the  government  and  higher  classes;  it  will  then  be  seen  that  the 
object  of  this  deprivation  of  the  rights  of  labor  would  be  subverted, 
and  that  these  unjust  governments  would  gain  no  advantage  to  them- 
selves, if  they  were  to  employ  all  this  power,  that  is  all  the  differ- 
ence in  the  cost  of  money  and  labor  between  them  and  such  a  coun- 
try as  the  United  States,  in  the  struggles  of  commercial  competi- 
tion. They  can  not  afford  it  in  their  state  of  society.  But  hav- 
ing the  power  always  in  their  hands,  to  use  such  a  portion  of  this 
difference  as  may  be  necessary  to  bear  most  effectually  on  the 
weak  and  vulnerable  points  of  free  states,  that  is,  such  points  as 
are  not  protected,  and  on  those  interests  which  are  of  most  impor- 
tance to  themselves,  they  will  of  course  select  those  points  of  at- 
tack on  which  to  make,  in  the  way  of  competition,  such  sacrifices 
as  policy  may  dictate,  and  by  which  they  can  accomplish  the  most 
with  a  given  amount  of  this  species  of  negative  expenditure,  in 
the  expectation  of  being  indemnified  by  profits  accruing  from  high 
prices,  after  competition  may  have  been  subdued  for  want  of  ade- 
quate protection  in  the  country  or  countries  with  which  they  are 
carrying  on  this  commercial  warfare.  They  know  too  well  how 
to  economize  such  transient  sacrifices,  in  order  to  attain  their 
objects. 

For  example:  Tt  need  not  be  said,  that  the  manufacture  of  cot- 
ton in  Great  Britain,  is  to  her  a  thing  of  vital  and  supreme  impor- 
tance. Before  she  had  a  rival  in  us,  she  taxed  the  raw  material 
heavily.  From  1S09  to  1814,  her  duty  on  the  imports  of  raw 
cotton  was  255.  Gd.  per  cwt.,  or  5^  cents  a  pound,  almost  equal  to 
its  present  price.  But  from  1815  to  1819,  after  we  began  to  man- 
ufacture cotton,  down  came  the  duty  to  85.  6(L  per  cwt.,  or  nearly 
2  cents  a  pound.  At  last  it  got  down  to  /g  of  a  penny  ;  and  in 
1845  it  was  found  necessary  to  remove  it  altogether.  This  was  a 
sacrifice  to  her  revenue;  but  it  was  necessary  to  retain  her  ascen- 
dency against  the  competition  in  the  manufacture  of  this  article  in 
the  United  States  and  elsewhere.  She  let  in  raw  cotton  free  in  order 
to  protect  herself  and  her  manufacturers  —  which  has  been  mis- 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       307 

named  Free  Trade.  In  the  same  manner,  all  the  abatements  in 
her  tariff  of  duties  on  imports,  under  the  administration  of  Sir  Rob- 
ert Peel,  as  shown  in  note,  pp.  11],  112,  without  a  single  exception, 
together  with  the  abolition  of  the  corn-laws,  were  made  on  the 
principle  of  protection,  and  for  purposes  of  protection  ;  and  tiiey 
are  called  Free  Trade.  It  was  to  maintain  her  commercial  posi- 
tion in  relation  to  competitors  in  other  countries,  that  she  made 
these  sacrifices  of  revenue  —  which,  however,  were  very  trivial, 
and  were  more  than  made  up  in  the  increase  of  revenue  from  du- 
ties on  other  articles.     (See  note  above  referred  to.) 

All  other  applications  of  this  principle  may  easily  be  understood 
by  the  above  illustrations,  as  these  are  directly  in  point.  Those 
governments  which  oppress  labor  by  depriving  it  of  reward,  and 
by  merely  granting  it  subsistence,  do  not  expend  all  the  power 
they  acquire  by  this  means  in  commercial  competition  with  free 
states  for  the  purpose  of  gaining  the  same  advantage  over  labor  in 
such  fcii-eign  parts.  A  small  fraction  of  this  power  skilfully  applied, 
will  answer  all  their  purposes,  as  the  examples  above  referred  to, 
in  the  action  of  the  British  government,  will  show. 

But  it  may  be  observed  that  the  amount  or  measure  of  protec- 
tion required  in  a  stale  or  nation  that  is  acting  on  the  defensive,  in 
order  to  secure  the  rights  of  its  laboring  classes  against  such  at- 
tacks, must  exceed  very  much  the  amount  or  measure  of  sacrifice 
that  is  made  by  the  assailing  party,  inasmuch  as  it  may  be  pre- 
sumed that  the  first  sacrifices  made  by  such  a  party,  are  but  a 
small  part  of  that  which  it  can  afford  to  make,  and  will  make,  since 
it  has  begun  the  contest,  if  necessary  to  success.  In  the  United 
States,  it  is  absolutely  necessary  that  our  public  men,  our  states- 
men, who  legislate  on  these  and  other  matters,  should  thoroughly 
understand  this  subject,  and  that  they  should  be  able  to  see,  with 
unerring  certainty,  what  measure  of  protection  may  be  required  for 
any  particular  article,  and  for  all  articles,  against  these  attacks;  and 
they  ought  to  know — they  will  be  liable  to  the  greatest  mistakes 
if  they  do  not  know  —  that  the  abolition  of  a  duty  in  a  foreign 
state  may  be  as  much  a  measure  of  protection  as  is  the  imposition 
of  duties  for  that  express  object,  as  in  the  case  of  all  the  abate- 
ments and  abolition  of  duties  which  have  recently  taken  place  in 
the  tariff  of  Great  Britain.  The  sacrifices  made  in  such  cases,  are 
not  positive,  but  negative,  for  a  reversion  of  benefits.  It  is  merely 
a  transient  reduction  of  the  taxes  on  labor  at  home,  for  the  sake 
of  obtaining  a  stronger  hold  on  labor  abroad,  in  the  expectation  of 


308  THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

a  return,  not  only  of  the  principal,  but  of  compound  interest,  or  it 
may  be  interest  equal  to  a  geometrical  ratio. 

The  ignorance  of  these  facts  and  principles,  which,  for  some 
twenty  years  past,  with  little  interruption,  lias  been  demonstrated 
by  those  who  have  chiefly  controlled  the  legislation  of  the  United 
States  on  this  point  of  public  policy,  is  not  more  amazing  than 
alarming.  To  call  it  ignorance,  is  niost  charitable.  Otherwise, 
their  influence  and  acts  would  be  in  the  highest  degree  criminal. 
They  evince  that  they  have  borrowed  their  theory  of  public  econ- 
omy from  foreign  parts  and  foreign  schools  ;  that  they  have  re- 
ceived their  lessons  from  the  enemies  of  the  country  ;  and  that 
they  are  utterly  incapable  of  understanding  the  subject.  This  is 
not  saying  too  much,  for  their  reasonings  and  arguments  prove  it. 
Presidential  messages,  United  States  treasury  reports,  such  as  those 
of  December,  1845,  '6,  and  '7,  and  other  public  documents,  have 
been  constructed  on  these  borrowed  and  fallacious  arguments,  and 
legislation,  the  most  momentous  and  most  unfortunate,  has  been 
made  to  conform  to  this  false  theory,  so  fatal  to  the  interests  of 
American  labor  and  of  the  i\merican  people. 

But  there  are  domestic  considerations  in  the  United  States 
which  should  enter  into  the  graduat'on  of  the  rule  of  protection,  in 
addition  to  those  arisino^  out  of  the  difference  between  the  cost  of 
money  and  labor  in  this  country,  and  their  cost  in  those  countries 
with  which  we  trade.  A  country  where  labor  is  free  and  inde- 
pendent, and  realizes  a  fair  compensation  as  a  consequence  of  its 
independence,  possesses  inherent  advantages  over  countries  where 
labor  is  not  free,  other  things  being  equal.  Take  for  example  the 
free  and  slave  states  of  this  Union.  The  great  secret  of  the  differ- 
ence in  prosperity  in  the  free  and  slave  states,  consists  more  in  the 
fact  that  labor  is  free  in  one  and  not  in  the  other,  than  in  any  or  all 
other  causes ;  and  the  slave  states  would  probably  soon  be  driven 
to  universal  emancipation,  from  interest,  but  for  the  monopoly  of 
southern  staples,  in  the  raising  of  which  northern  free  labor  can 
never  come  in  competition.  Men  who  are  their  own  property, 
who  work  for  themselves,  and  whose  fortunes  are  of  their  own 
creation,  with  the  exisdng  chances  before  them  of  rising  in  the 
world,  and  becoming  men  of  estate,  of  wealth,  and  of  influence, 
are  a  very  diflferent  sort  of  moral  and  physical  machine,  from  men 
who  know  they  are  not  their  own,  and  who  always  feel  that  they 
are  working:  for  masters,  and  not  for  themselves.  With  the  former, 
labor  is  a  pleasure ;  with  the  latter,  it  is  a  task.     The  freeman 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       309 

works  for  reward  ;  the  slave  because  he  is  driven  to  it ;  and  the 
difference  in  the  results,  as  to  their  commercial  values,  is  as  great 
as  in  their  feelings  and  motives.  There  is  very  little  difference  in 
the  position  and  character  of  the  labor  of  European  nations,  as  to 
its  pliysical  effectiveness  resulting  from  moral  incentives,  and  that 
of  slave  labor  in  the  United  States.  Both  are  forced,  and  both  are 
about  equally  well  provided  for,  that  is,  furnished  with  a  subsistence 
designed  to  keep  them  in  the  best  working  order. 

All  slave  labor  in  the  United  States,  which  is  not  applied  to  the 
production  of  what  are  commonly  called  slave-grown  staples,  stands 
more  in  need  of  the  protection  of  a  national  policy,  so  far  as  the 
interest  of  masters  is  concerned,  than  free  labor,  because  slave  la- 
bor is  more  costly  than  either  its  foreign  or  domestic  competitor, 
when  regarded  in  connexion  with  the  comparative  amount  of  its 
product  The  foreign  competitor,  called  free,  has  to  raise  itself  till 
fit  to  work  ;  gets  only  a  bare  subsistence  while  it  can  work;  and 
when  it  can  work  no  longer,  it  is  cast  off  to  perish  ;  whereas,  slave 
labor  is  always  a  cost :  a  cost  in  raising,  a  cost  in  sickness,  a  cost 
after  it  has  done  working ;  and  its  product,  while  working,  is  greatly 
less,  because  it  wants  the  motive  of  working  for  itself.  And  it  has 
already  been  proved  by  experience  that  slave  labor  is  generally 
obliged  to  retire  before  American  free  labor,  when  both  are  en- 
gaged in  producing  tlie  same  things.  If,  therefore,  American  free 
labor  requires  protection  against  foreign  pauper  labor,  much  more 
does  Atnerican  slave  labor  require  it,  for  the  interest  of  its  owners. 
The  labof  of  the  ox  and  that  of  a  slave  occupy  the  same  position  in 
public  economy  ;  but  the  latter  is  less  able  to  stand  against  competition. 

Adam  Smith  says  :  "  The  experience  of  all  ages  and  nations,  I 
Relieve,  demonstrates  that  work  done  by  slaves,  though  it  appears 
to  cost  only  their  maintenance,  is  in  the  end  the  dearest  of  any." — 
■**  The  planting  of  sugar  and  tobacco  [that  of  cotton  in  America 
was  not  then  known]  ean  afford  the  expense  of  slave  cultivation." — 
*'■  The  profits  of  a  sugar  plantation  in  any  of  our  West  India  colo- 
saies,  are  generally  much  greater  than  any  that  is  known  in  either 
Euro^^e  or  America;  and  the  profits  of  a  tobacco  plantation,  though 
Kiferior  to  tiiose  of  sugar,  are  superior  to  those  of  corn.  Both  can 
afford  the  expense  of  slave  cultivation."  This  was  written  anterior 
to  1775.  The  cultivation  of  cotton  in  the  United  States  was  com- 
srnenced  in  1790,  and  has  grown  up  to  a  stupendous  interest  for  the 
jprofitaWe  empioyraent  of  slave  labor,  without  anj  rivals'hip  in  free 
labor. 


310       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

But  it  is  free  labor,  chiefly,  tl)at  has  created  all  the  superioritj' 
of  the  United  States  over  other  countries,  ia  its  general  capacities 
of  wealth.  There  are,  indeed,  vast  resources  and  treasures  of  na- 
ture here.  But  it  is  the  free  labor  and  free  spirit  of  the  country 
■which  have  turned  them  to  profitable  account.  It  is  free  labor 
which,  while  unembarrassed  with  vicious  and  favored  with  wise 
leo-islation,  rolls  up  wealth  in  heaps.  But  for  this,  and  but  for  the 
fact,  that  European  and  other  foreign  powers,  which  wrest  fronj 
labor  so  large  a  portion  of  its  reward,  can  not  afford  to  employ  all 
ihe  power  thus  wrongfully  acquired  in  commercial  conn  petition 
with  us ;  but  for  these  facis,  we  saj,  the  measure  of  protection  for 
American  labor,  naturally  required,  would  be  the  difference  in  the 
cost  of  money  and  labor  in  tbese  two  quarters,  not  less  than  an 
averao-e  of  one  hundred  per  cent.  But  the  average  protectiore 
which  experience  has  dictated  as  n-ecessary,  as  for  example  in  the 
tariff  of  1842,  is  about  40  fer  cent.  The  reasons  why  protection 
is  required  to  be  distributed  so  variously  in  its  degrees,  on  different 
articles  of  domestic  production,  are,  first,  because  the  power  of  for- 
eign competition,  as  seen  above,  is  brought  to  bear  more  on  some 
articles  than  on  others ;  and  next,  because  some  domestic  produc- 
tions have  acquired  a  stronger  position  than  others,  and  do  no6 
need  so  much  help.  Hence,  in  a  well-digested  tariff,  we  find  Pro- 
tection varying  from  a  very  low  up  to  a  very  high  rate;  and  noth- 
ing could  be  a  stronger  evidence  of  the  correctness- of  the  principle 
involved  in  the  rule  laid  down,  to  wit,  that  the  necessity  of  Protec- 
tion arises  from  the  difference  in  the  cost  of  money  and  labor  in  this 
country  and  others,  than  the  facts  above  noticed. 

Although,  therefore,  as  above  recognised,  this  difference  between 
the  cost  of  money  and  labor  in  Europe  and  their  cost  in  the  United 
States,  can  not  be  laid  down  as  an  exact  rule  by  which  protection 
is,  in  all  cases,  to  be  graduated,  it  is,  nevertheless,  the  foundation 
of  the  rule.  It  is  remarkable,  that  a  principle,  like  this,  so  potent 
and  overruling,  should  not  have  been  more  influential  with  Amer- 
ican statesmen,  as  one  from  which  there'is  no  escape  in  the  current 
of  public  affairs.  There  is  no  law  in  the  everlasting  code  of  nature, 
that  is  more  certain  than  this,  and  none  the  penalty  of  which  must 
more  certainly  be  paid,  if  violated. 

It  is  due,  however,  to  the  instincts  of  the  common  mind,  to  ob- 
serve, that  the  people  of  this  covmtry  have  not  been  altogether 
insensible  of  a  natural  hostility  between  their  labor  and  what  is 
commonly  called  "the  pauper  labor  of  Europe.'*     The  whole  of 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       311 

the  truth  lies  in  this  instinctive  apprehension.  It  has  been  in  their 
mouths  as  long  as  the  oldest  man  can  remember.  It  was  in  the 
minds  and  hearts  of  the  revolutionary  fathers,  and  stimulated  them 
to  all  their  mighty  etforts,  to  their  stupendous  sacrifices,  and  to 
those  strifes  of  arms  which  achieved  so  great  a  victory.  The 
American  people  have  generally  felt,  that  Europe  is  a  great  prison- 
house  of  labor,  the  products  of  which,  if  brought  in  direct  and  open 
competition  with  their  own,  would  drag  them  down  to  the  same 
level,  and  subject  them  to  the  same  disadvantages  —  ultimately  to 
the  same  poverty,  wretchedness,  and  slavery. 

Nor  can  it  be  said,  that  some  of  the  public  men  of  this  country, 
poUtieians,  statesmen,  and  others,  have  not  apprehended  this  great 
truth,  preached  it  eloquently,  set  forth  its  operations  and  results, 
and  warned  the  people. 

But  hitherto  the  field  of  debate  has  been  wide,  the  materials  of 
argument  disjunct  and  scattered,  and  foreign  authorities,  based  on 
fallacious  and  unsound  principles,  have  been  forced  upon  public 
attention,  to  distract,  divide,  and  conquer.  American  schools  and 
colleges,  having  nothing  else  to  lay  before  their  pupils  —  the  tutors 
of  which  may  without  offence  be  supposed  better  skilled  in  teach- 
ing boys  than  statesmen,  and  not  perhaps  thinking  that  they  were 
educating  statesmen  —  have  been  forced  to  rely  on  Adam  Smith, 
David  Ricardo,  Jean  Baptiste  Say,  and  such  like,  for  lessons  on 
public  economy  ! 

It  would  be  strange,  however,  after  so  much  debate,  and  where 
such  vast  interests  are  at  stake,  if  the  argument  could  never  be 
brought  to  a  point,  on  which  all  could  see  that  the  truth  of  the 
matter  hinges.  That  point,  it  is  believed,  is  indicated  by  the  differ- 
ence in  the  cost  of  money  and  labor  in  the  United  States  and  in 
foreign  parts.  It  is  a  commercial  principle,  determined  with  all 
the  certainty  of  arithmetical  results,  about  which,  therefore,  there 
can  be  no  ground  of  controversy  among  reasonable  minds.  The 
rule  is  derived  from  the  fact,  that  the  producing  powers  of  Europe 
and  other  foreign  parts,  that  is,  money  and  labor,  cost  only  half  as 
much  as  in  the  United  States — in  truth  less  than  half  as  much. 
It  will  follow,  therefore,  that  American  labor,  which  in  fact  is  the 
chief  thing  concerned,  can  never  stand  against  such  odds  without 
protection. 

But  a  better  rule  than  all,  perhaps,  for  the  graduation  of  duties 
for  Protection,  is  the  application  and  advice  of  parties  who  desire 
it.     It  is  the  experience  of  the  people  that  teaches  what  they  want, 


312       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

and  they  are  the  best  judges.  They  never  ask  for  protection,  un- 
less they  want  it.  Why  should  they  ?  It  would  be  absurd.  And 
the  fact  that  they  ask,  is  proof  that  they  want. 

The  following  argument  of  Adam  Smith,  made  for  Free  Trade, 
is  so  pertinent  and  forcible  here,  that  we  can  not  resist  the  tempta- 
tion of  using  it  for  our  own  purpose  :  "  The  annual  revenue  of 
every  society  is  always  precisely  equal  to  the  exchangeable  value 
of  the  whole  annual  produce  of  its  industry,  or  rather,  is  precisely 
the  same  thing  with  that  exchangeable  value.  As  every  individual, 
therefore,  endeavors,  as  much  as  he  can,  both  to  employ  his  capi- 
tal in  the  support  of  domestic  industry,  and  so  to  direct  that  indus- 
try, that  its  produce  may  be  of  the  greatest  value;  every  individual 
necessarily  labors  to  render  the  annual  revenue  of  the  society  as 
great  as  be  can.  He  generally,  indeed,  neither  intends  to  promote 
the  public  interest,  nor  knows  how  much  he  is  promoting  it.  By 
preferring  the  support  of  domestic  to  that  of  foreign  industry,  he 
intends  only  his  own  security  ;  and  by  directing  that  industry  in 
such  a  manner  that  its  produce  may  be  of  the  greatest  value,  he  in- 
tends only  his  own  gain ;  and  he  is  in  that,  as  in  many  other  cases, 
led  by  an  invisible  hand,  to  promote  an  end  which  was  no  part  of 
his  intention.  Nor  is  it  always  worse  for  the  society,  that  it  was  no 
part  of  it.  By  pursuing  his  own  interest,  he  frequently  promotes 
that  of  the  society  more  effectually  than  when  he  intends  to  promote 
it.  I  have  never  known  much  good  done  by  those  who  affect  to 
trade  for  the  public  good.  It  is  an  affectation,  indeed,  not  very  com- 
mon an)ong  merchants,  and  very  few  words  need  be  employed  in 
dissuading  them  from  it.  What  is  the  species  of  industry  which  his 
capital  can  best  employ,  and  of  which  the  produce  is  likely  to  be 
of  the  greatest  value,  every  individual,  it  is  evident,  can,  in  his  local 
situation,  judge  much  better  than  any  statesman  or  lawgiver  can  do 
for  him.  The  statesman  who  should  attempt  to  direct  private  peo- 
ple in  what  manner  they  ought  to  employ  their  capitals,  would  not 
only  load  himself  with  a  most  unnecessary  attention,  but  assume  an 
authority  which  could  safely  be  trusted,  not  only  to  no  single  per- 
son, but  to  no  council  or  senate  whatever,  and  which  would  no- 
where be  so  dangerous  as  in  the  hands  of  a  man  who  had  folly  and 
presumption  enough  to  fancy  himself  fit  to  exercise  it." 

Nothing,  surely,  could  be  more  delightful  than  this  to  those 
Americans  who  only  ask  to  be  protected  in  their  own  chosen  ways 
—  a  protection  to  which  they  are  justly  entitled.  Adam  Smith  en- 
tirely misrepresents  the  case,  when  he  assumes,  that  Protection  is 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       313 

an  "  attempt  to  direct  private  people  in  what  way  tiiey  ought  to 
employ  their  capital."  It  only  encourages  and  s/iir/ds  them  from 
harm,  in  ways  in  which  they  themselves  choose  to  "  employ  their 
capital."  In  no  case  does  Protection  conlroL  the  direction  and  em- 
ployment of  capital ;  it  on\y  invites  it  into  a  field  where  it  could  not 
otherwise  go,  and  defends  its  position  there.  Its  function  is  to  do 
that  which  is  solicited,  not  to  impose  that  which  is  not  desired  ;  and 
when  it  is  shown,  as  we  have  done,  that  no  parties  can  possibly  be 
injured  by  the  protection  of  others  —  except  by  a  partiality  in  the 
distribution  of  its  benefits,  in  helping  one  more  than  another,  since 
all  are  benefited  in  some  degree  by  protection  afforded  in  any  cases 
whatever  —  this  reasoning  of  Adam  Smith  all  goes  for  a  protective 
system.  When  the  people  desire  and  obtain  protection  in  this, 
that,  or  the  other  pursuit,  for  their  "  own  gain,"  they  are,  as  Adam 
Smith  justly  says,  "led  by  an  invisible  hand,  to  promote  an  end 
which  was  no  part  of  their  intention,"  to  wit,  the  common  good  of 
"  the  society."  Nothing  is  more  true,  than  that  "  every  individual 
can,  in  his  local  situation,  judge  much  better  than  any  statesman  or 
lawgiver  can  for  him,  what  is  the  species  of  industry  which  his  cap- 
ital can  best  employ,  and  of  which  the  produce  is  likely  to  be  of 
the  greatest  value ;"  and  therefore  he  asks  protection  in  it,  if  he 
needs  it.  This  is  the  opposite  of  directing  and  controUing  his 
capital.  The  objection,  that  it  indirectly  controls  other  parties,  to 
their  injury,  we  have  answered  in  another  place,  by  showing  that 
it  controls  only  the  importing  merchant,  to  prevent  his  trading  at 
the  expense  of  the  country,  the  very  thing  which  ought  to  be  done. 

It  is  only  when  the  government  interferes  with  and  dictates  to 
the  pursuits  of  the  people,  as,  for  example,  forcing  them  back  to 
agriculture,  by  refusing  to  protect  manufactures,  that  mischief,  and 
untold  mischief,  is  done.  Let  the  people  choose  their  own  pur- 
suits, and  protect  them  when  they  ask  it,  and  they  will  be  sure  to 
promote  the  public,  by  securing  their  own  private  wealth. 

Adam  Smith  still  farther  concedes  all  that  can  be  asked  :  "  What 
is  prudent  in  every  private  family,  can  scarcely  be  folly  in  that  of  a 
great  kingdom."  And  what  does  the  prudence  of  a  private  family 
require  ?  To  take  care  of  its  own  interests,  to  be  sure  —  to  pro- 
tect them.  If  this  be  not  done,  things  will  surely  come  to  bad  ; 
and  it  must  take  care  of  those  interests,  too,  in  relation  to  the  con- 
flicting agencies  with  which  it  is  for  ever  invested  and  assailed. 
This  is  precisely  the  doctrine  of  Protection. 

It  is  singular  that,  in  addition  to  all  this,  Adam  Smith,  while 


014       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

pleading  the  cause  of  Free  Trade,  not  only  concedes,  but  justifies, 
the  [)rinciple  of  Protection  in  all  its  length  and  breadth  of  applica- 
tion, as  follows  :  "  There  seem,  however,  to  be  two  cases,  in  which 
it  will  generally  be  advantageous  to  lay  some  burden  upon  foreign, 
for  the  encouragement  of  domestic  industry.  Tlie  first  is,  when 
some  particular  sort  of  industry  is  necessary  for  the  defence  of  the 
country.'  The  defence  of  Great  Britain,  for  example,  depends 
very  much  upon  its  sailors  and  shipping.  The  act  of  navigation, 
therefore  very  properly,  endeavors  to  give  the  sailors  and  shipping 
of  Great  Britain  the  monojioly  of  the  trade  of  their  own  country, 
in  some  cases  by  absolute  prohibitions,  and  in'others  by  heavy  bur- 
dens upon  the  shippping  of  foreign  countries." 

Let  any  one  judge  whether  the  principle  here  conceded  can 
have  any  stopping-place,  so  long  as,  in  the  judgment  of  any  people 
or  government,  "any  particular  sort  of  industry,"  as  Adam  Smith 
calls  it,  requires  protection  for  the  defence  of  the  country,  <///i/s,  for 
its  interests  ;  for,  if  its  interests,  in  which  its  strength  and  power 
consist,  are  suffered  to  go  to  wreck,  it  is  folly  to  talk  about  defence. 
There  can  be  no  defence  short  of  maintaining  that  physical  power 
of  a  country,  which  consists  in  maintaining  its  interests. 

"  The  second  case,"  says  Adam  Smith,  "  in  which  it  will  gen- 
erally be  advantageous  to  lay  some  burden  upon  foreign  for  the 
encoui'agement  of  domestic  industry,  is,  when  some  tax  is  imposed 
at  home  upon  the  produce  of  the  latter.  In  this  case,  it  seems  rea- 
sonable, that  an  equal  tax  should  be  imposed  upon  the  like  pro- 
duce of  the  former."  This  on  the  principle  of  retaliation.  So  we 
have  Adam  Smith  a  protectionist  on  two  points,  which,  as  will  be 
seen,  is  having  him  on  all  points  :  first,  when  "  it  will  be  advan- 
tageous for  the  encouragement  of  domestic  industry  ;"  and  next, 
when  the  lex  tdltouis,  or  law  of  retaliation,  requires  it.  Who  ever 
asked  for  more  than  this  ? 

Let  the  following  facts,  the  list  of  which  might  be  greatly  en- 
larged, show  how  far  the  United  States  would  be  entitled  to  go,  on 
this  principle  of  retaliation,  laid  down  by  Adam  Smith.  American 
flour  in  Cuba  pays  a  duty  of  about  $10  a  barrel  ;  in  Rio  Janeiro, 
$5  to  $6  ;  and  in  many  other  foreign  parts,  the  duties  on  this  arti- 
cle range  from  50  to  150  per  cent.  Li  return,  we  take  coffee 
without  duty.  We  have  reciprocity  treaties  with  several  foreign 
powers,  the  effect  of  which  has  already  been  to  take  away  about 
one  third  of  our  carrying-trade.  When  Americans  began  to  ex- 
port their  goods  to  British  dependencies,  the  British  government  im- 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.      315 

posed  a  duty  against  us,  first  of  5,  next  of  8^,  then  of  10^,  and  finally 
of  15  per  cent.,  which,  it  is  supposed,  will  be  an  exclusion.  It  is 
worthy  of  remark,  that  on  the  single  staple  of  tobacco,  which  she 
receives  from  the  United  States,  Great  Britain  levies  an  amount 
of  duties  about  equal  to  the  total  amount  of  customs  collected  on 
all  articles  imported  into  the  United  States  from  all  foreign  coun- 
tries ;  and  also  about  equal  to  the  total  annual  expenditures  of  our 
government.  The  Hon.  P.  Triplett,  of  Kentucky,  made  a  com- 
munication to  the  committee  on  manufactures,  in  the  27th  Con- 
gress, from  which  are  deduced  the  following  facts:  that  American 
products  consumed  in  Europe  pay  duties  on  entering  there,  equal 
to  lialf  o^  their  entire  value  ;  whereas,  European  products  consumed 
in  the  United  States  pay  duties  here  equal  to  onefifili  of  their  value. 
In  1S41,  imports  into  the  United  States  were  $127,945,0l5'0,  and  ex- 
ports, $91,000,000.  The  duties  raised  from  these  imports  amount- 
ed to  $14,487,000,  being  about  11^  per  cent.;  whereas,  the  duties 
which  foreign  countries  obtained  from  exports  from  the  United 
States,  of  that  year,  amounted  to  $113,500,000,  or  124  per  cent. 
The  average  of  exports  of  tobacco  from  the  United  States  to  Eu- 
rope, for  1839  and  1840,  was  $9,225,000  for  each  year  ;  and  the 
average  duties  imposed  for  each  year  by  European  governments, 
was  $32,463,000,  or  350  per  cent.  The  duties  on  American 
tobacco  in  Europe  have  been  as  high  as  $35,000,000  a  year. 

But  Adam  Smith  goes  even  farther,  if  it  were  possible.  He 
says :  "  As  there  are  two  cases  in  which  it  will  generally  be  ad- 
vantageous to  lay  some  burden  upon  foreign,  for  the  encourage- 
ment of  domestic  industry,  so  there  are  two  other  cases  in  which 
it  may  sometimes  be  a  matter  of  deliberation  :  in  the  one,  how  far 
it  is  proper  to  continue  the  free  importation  of  certain  foreign  goods  ; 
and  in  the  other,  how  far,  or  in  what  manner,  it  may  be  proper  to 
restore  that  free  importation,  after  it  has  been  for  some  time  inter- 
rupted." Is  not  this  truly  astonishing  ?  Here  is  the  whole  field 
open,  and  opened  by  the  hand  of  Adam  Smith.  "  It  may  be  a 
matter  of  deliberation."  About  what  ?  —  First,  as  to  what  articles, 
now,  or  at  any  time,  free,  duties  shall  be  put  on  to ;  and  next,  as  to 
what  articles,  now,  or  at  any  time,  subject  to  duty,  shall  be  made 
free.  Is  it  possible  to  have  a  more  extended  discretion?  And 
the  British  government  have  always  acted  on  this  rule  of  "  deliber- 
ation." We  have  shown  that  Sir  Robert  Peel's  policy,  in  making 
some  articles  free,  was  precisely  of  this  kind  —  not  for  Free  Trade, 
but  on  "  deliberation,"  according  to  Adam  Smith's  rule. 


316       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

Adam  Smith  and  his  followers  are  for  ever  begging  the  question, 
that  Protection  is  a  tax.  We  disprove  it  a  thousand  and  one  times, 
and  there  they  are  still,  making  the  same  asseveration,  without  deign- 
ing to  offer  evidence. 

We  are  inclined  to  believe,  that  a  protective  system  operates  the 
same  in  all  countries,  as  in  the  United  States.  Take,  for  example, 
Dr.  Bowering's  report  on  G  ermany,  to  the  British  Parliament,  1840. 
Tlie  German  Zoll-Verein  treaty  had  then  been  in  operation  some 
ten  years.  Dr.  Bowering  admits,  that  the  German  manufactures, 
which  are  protected  by  a  high-tariff  duty,  are  better,  and  sold  on 
more  reasonable  terms,  than  the  like  foreign  articles ;  that  the  de- 
mand for  agricultural  products  had  increased,  and  the  prices  risen, 
under  the  high  tariff;  that  land  had  risen  from  50  to  100  per  cent. ; 
that  labor  was  better  paid  ;  that  the  wages  of  labor,  in  the  manu- 
facturing districts,  had  risen  30  per  cent.  The  reason  of  admitting 
these  facts,  is  understood  to  have  been,  that  if  the  British  corn-laws 
were  not  instantly  abolished,  Germany  would  become  independent, 
and  learn  too  much  of  the  benefits  of  Protection.  The  AUgemeine 
Zeitung  said  in  1841,  "  Within  these  ten  years,"  since  Protection 
was  established,  "  Germany  has  made  the  advance  of  a  century  in 
welfare  and  industry,  in  the  feeling  of  self-dependence,  and  in  na- 
tional energy." 

Another  rule  laid  down  by  Adam  Smith,  viz.,  that  "  the  general 
industry  of  the  society  can  never  exceed  what  the  capital  of  the 
society  can  employ,"  as  an  element  of  his  grand  proposition  of 
Free  Trade,  only  shows,  first,  that  this  is  assumed  in  view  of  a 
given  state  of  society,  with  which,  peradventure,  he  was  acquainted  ; 
and  secondly,  that  he  was  totally  ignorant  of  the  condition  of  things 
in  America.  In  England,  as  it  then  was,  probably,  and  is  now  it 
nfiay  be,  this  rule  might  possibly  apply  ;  but  every  one  knows,  in 
this  quarter,  it  does  not  apply  here.  No  man,  in  the  United  States, 
is  necessarily  dependent  on  "  the  capital  of  the  society,"  for  em- 
ployment. He  can  at  any  time  go  into  the  backwoods,  and  be 
perfectly  independent ;  and  it  is  because  of  this  great  open  field, 
of  this  illimitable  chance,  into  which  multitudes  are  constantly 
pushing  their  way,  and  literally  opening  and  creating  a  new  world, 
thereby  proving  that  anybody  else  can  do  it,  that  man,  in  this  coun- 
try, is  independent  of  capital  —  certainly  of  that  species  of  capital, 
of  which  Adam  Smith  here  speaks.  It  is  not,  therefore,  true  here, 
that  "the  general  industry  of  the  society  can  never  exceed  what 
the  capital  of  the  society  can  employ."     This  only  proves,  that, 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       317 

however  well  Adam  Smith  may  have  been  qualified  to  write  a 
system  of  public  economy  for  Great  Britain,  he  was  totally  unquali- 
fied to  write  one  for  the  United  States ;  and  that  his  attempt  to 
write  for  all  nations,  as  if  he  could  lay  down  principles  and  form  a 
system  equally  applicable  to  all,  was  a  very  audacious  one. 

The  cry  of  "  monopoly,"  which  the  arts  of  demagogues  have  sent 
barking  over  the  land  for  a  few  years  past,  like  a  pack  of  hounds 
let  loose  on  the  scent  of  game,  will  be  found  to  be  not  only  without 
foundation,  so  far  as  it  applies  to  the  encouragement  of  American 
manufactures  ;  but  it  will  appear,  before  we  shall  have  done  with 
the  subject,  that  it  is  a  direct  persecution  of  American  labor,  hunt- 
ing it  down,  and  injuring  it  first  and  chiefly.  When  a  party  a=;ks 
protection  for  an  American  product,  it  is  a  medin/e  application  of 
American  labor  for  employment  and  reward,  without  expense  to 
anybody,  and  with  benefit  to  the  public  and  to  all  parties  ;  for  it  is 
shown  elsewhere,  that  protective  duties,  in  the  United  States  are 
not  taxes,  but  the  contrary.  The  capitalist,  who  comes  with  a  pe- 
tition to  government  for  protection  in  a  specific  enterprise,  appears 
as  the  proxy  of  labor,  asking  for  a  position  in  which  he  can  employ 
labor  and  pay  for  it ;  and  every  new  investment  of  capital,  in  a  pro- 
ductive art,  or  pursuit,  creates  a  new  demand  for  labor,  and  tends 
to  enhance  its  reward.  No  matter  how  great  the  profit  of  the 
investment.  "The  greater  it  is,  so  much  greater  the  benefit  to  labor  ; 
and  it  is  labor  chiefly  that  is  benefited  by  advantageous  oudays  of 
capital.  Labor,  on  an  average  in  the  United  States,  as  before 
shown,  is  worth  at  least  50  per  cent,  on  itself  as  capital,  the  value 
of  which  never  diminishes,  but  always  increases,  by  the  encourage- 
ment given  to  other  capital  to  employ  it ;  and  just  in  proportion  as 
other  capital  finds  encouragement  under  protection  to  extend  its 
operations,  does  its  own  rate  of  profit  decrease,  while  that  of  labor 
increases.  This  is  a  settled  principle.  It  is  the  effect  of  the  rival- 
ship  of  capital  in  different  hands.  Large  profits  of  capital  in  any 
employment,  not  invested  with  exclusive  privileges  —  which  alone 
constitute  a  monopoly  —  are  like  a  vacuum  in  nature.  Other  cap- 
ital immediately  rushes  to  the  point,  till  there  is  a  surfeit.  The 
fact  of  large  profits  can  not  endure  —  must  necessarily  be  transient. 

Adam  Smith  says  :  "  As  the  quantity  of  stock  [capital]  to  be  lent 
at  interest  increases,  the  interest  [profit]  necessarily  diminishes.  As 
capitals  increase  in  any  country,  the  profits  which  can  be  made  by  em- 
ploying them  necessarily  diminish.  There  arises,  in  consequence, 
a  competition  between  different  capitals.     The  owner  of  one  must 


318       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

not  only  sell  what  he  deals  in  somewhat  cheaper,  but,  in  order  to 
get  it  to  sell,  he  must  sometimes  too  buy  it  dearer.  The  demand 
for  productive  labor,  by  the  increase  of  the  funds  which  are  des- 
tined to  maintain  it,  grows  every  day  greater  and  greater.  Labor- 
ers easily  find  employment,  but  the  owners  of  capitals  find  it  diffi- 
cult to  get  laborers  to  employ.  Their  competition  raises  the  wa- 
ges of  labor,  and  sinks  the  profits  of  stock.  But  when  the  profits 
are  in  this  manner  diminished,  as  it  were,  at  both  ends,  the  rate  of 
interest  must  necessarily  be  diminished  with  them." 

The  Hon.  Daniel  Webster  says:  "The  increase  of  the  invest- 
ments of  capital  in  great  works,  tends  to  reduce  the  profits  on  that 
capital.  That  is  a  necessary  result.  But  then  it  has  exactly  the 
reverse  action  upon  labor.  For  the  more  that  capital  is  invested  in 
the  great  operations,  the  greater  is  the  call  for  labor  ;  and  therefore, 
the  ratio  is  here  the  other  way,  and  the  rates  of  labor  increase  as 
the  profits  of  capital  are  diminished."  —  (His  speech  in  Senate, 
on  the  25th  of  July,  1S46.)  It  is  impossible  that  investments  of 
capital  which  employ  labor  should  be  multiplied  or  extended  to 
the  disadvantage  of  labor,  and  it  is  always  for  the  interests  of  la- 
bor that  protection  should  be  granted,  if  necessary,  to  secure  the 
end  of  such  investments.  Whenever  capital  invokes  it,  it  is  the 
same  thing  as  if  labor  invoked  it;  and  the  fact  may  always  be 
taken  as  the  measure  of  graduation  required  by  the  interests  of 
labor  in  fixing  protection. 

As  labor  occupies  the  position  of  parent  to  all  other  capital,  it 
would  seem  to  be  very  fair,  that  this  thing  of  its  own  creation 
should  be  employed  for  its  own  benefit ;  and  when  the  benefit  can 
be  made  reciprocal,  it  is  all  the  better  and  more  satisfactory.  When- 
ever capital  asks  for  protection  in  any  specific  investment,  for  the 
creation  of  home  products  of  any  kind,  against  foreign  competition, 
it  is  always  identical  with  the  demand  of  home  labor  for  employ- 
ment and  reward.  The  protection  is  that  of  labor,  ultimately  and 
chiefly.  "  Capital,"  says  the  Hon.  Abbott  Lawrence,  "has  usually 
had  the  power  to  take  care  of  itself,  and  does  not  require  the  aid 
'^  of  Congress  to  place  it  in  any  other  position,  than  to  put  the  labor 

in  motion.     Congress  should  legislate  fof  the  labor,  and  the  capital 
will  take  care  of  itself" 

Some  have  supposed  that  American  arts  and  other  pursuits  may, 
under  a  system  of  protection,  ultimately  attain  to  such  perfection 
and  strength  as  no  longer  to  need  protection.  They  seem  to  im- 
agine that  protection  is  only  needed  to  get  well  started.     No  doubt. 


'-'^^  THE  CLAIMS  OF  AMERICA'TV  LABOR  FOR  PROTECTION.       319 

for  the  reason  already  noticed,  viz.,  that  a  free  country,  where  labor  "' 
is  rewarded,  has  many  inlierent  advantages  over  those  whose  labor 
is  not  free,  and  is  not  properly  rewarded;  —  for  this  reason  it  is 
doubtless  true  that  the  United  States,  after  a  long-protracted  enjoy- 
ment of  an  adequate  system  of  |jrotection,  would  be  able  to  run  a 
powerful  race  with  the  European  nations  on  a  Free-Trade  platform. 
But  still  it  must  be  seen,  that  so  long  as  the  conditions  of  society 
in  these  two  quarters  are  so  greatly  diverse  as  to  create  and  main- 
tain a  difference  of  a  hundred  per  cent.,  in  favor  of  Europe  and 
against  this  country,  in  the  cost  of  money  and  labor,  the  contest 
would  be  most  unequal  ;  and  while  this  difference  exists,  it  is  impos- 
sible for  any  one  reasonably  to  conclude,  that  the  necessity  of  pro- 
tection will  not  also  exist,  however  perfect  may  be  the  state  of 
American  arts  and  instruments  of  labor,  and  however  stronir  their 
position.     Justice  alone  would  seem  to  require  it. 

It  has  been  most  unfortunate  for  this  country  that  demagogues, 
the  greatest  scourge  of  humanity,  have  been  able  to  take  advan- 
tage of  the  natural  jealousies  existing  in  the  hearts  of  the  poor 
against  the  rich,  and  of  the  unprosperous  against  the  prosperous, 
by  exciting  in  the  miuds  of  the  former  a  belief,  that  the  very  means 
of  their  comfort  and  happiness,  and  their  chances  for  the  im- 
provement of  their  condition,  are  adverse  to  them,  and  the  means 
of  depriving  them  of  their  rights.  As  above  shown,  when  capital 
asks  for  protection,  it  asks  it  in  the  name  and  for  the  benefit  of  la- 
bor, to  increase  the  demand  for  it,  and  to  give  it  better  chances  ; 
and  as  above  shown,  the  profits  of  capital  diminish  as  the  demand 
for  labor  and  its  reward  are  increased.  The  rivalship  of  capital  is 
the  harvest  of  labor.  The  more  the  protection  of  government  en- 
courafres  new  investments  of  capital  in  forms  to  employ  labor,  so 
much  better  will  be  the  condition  and  prospects  of  the  laboring 
classes.  For  the  want  of  such  protection,  laborers  are  injured  ; 
with  it,  they  are  benefited  ;  for  it  is  their  protection  chiefly  ;  they 
are  the  party  most  deeply  interested.  And  yet  the  demagogues  of 
the  country,  by  appealing  to  the  natural  jealousies  of  the  peop'e, 
have,  to  a  great  extent,  made  them  believe,  by  misrepresentation, 
that  capitalists,  occupying  such  a  position,  under  the  protection  of 
government,  as  to  employ  labor,  and  afford  it  better  chances,  are 
"monopolists,"  invested  with  and  using  a  power  to  oppress  labor, 
and  to  oppress  the  poor.  Strange  as  it  may  seem,  everybody 
knows  that  this  is  a  fact.  The  poor  laborer  is  made  to  believe,  by 
ingenious  falsehoods  addressed  to  his  natural  jealousies,  that  they 


320       THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION. 

who  give  him  employment,  and  afford  him  the  means  of  living  — 
of  risin"-  in  the  world  —  are  his  natural  enemies  —  his  oppressors; 
and  that  the  greater  the  demand  for  his  labor,  and  the  greater  his 
reward  for  it,  so  much  greater  his  rnisfortnne. 

They  who  are  ingenious  enough  to  invent  such  a  fallacy,  are 
sufficiently  corrupt  and  unprincipled  not  to  employ  the  falsehood. 
They  can  not  but  know  it  is  false.  They  can  not  but  know  that 
any  degree  of  protection  which  augments  investments  of  capital  in 
any  specific  enterprise,  and  which  enlarges  competition,  is  so  far 
from  creating  a  monopoly,  that  it  is  the  very  way  to  break  it  down, 
if  it  had  existed  before. 

In  such  a  community  as  the  Unhed  Slates,  wealth  is  generally 
accumulated  by  the  labor,  industry,  enterprise,  frugality,  and  other 
like  virtues  of  those  who  began  life  poor,  and  rose  from  an  humble 
condition.     In  the  absence  of  the  laws  of  primogeniture  and  en- 
tails, large  accumulations  of  wealth   rarely   descend  to  the  third 
generation  before  they  are  dissipated,  and  fall  into  the  hands  of 
those  who,  in  their  turn,  are  rising  to  affluence  from  nothing,  by 
their  virtues.     The  American  wheel  of  fortune  is  thus  constantly 
turning  round,  so  that  the  descent  of  those  at  the  top,  brings  up 
those  at  the  bottom.     It  is  the  investment  of  capital  for  the  employ- 
ment of  labor,  that  enables  those  at  the  bottom  to  rise  ;  and  the 
larger  and  the  more  multiform  the  investments,  so  much  better  will 
be  their  chances,  and  so  much  more  rapid  their  ascent.     But  these 
demagogues,  putting  their  hand  to  this  wheel,  and  crying  out  to 
those  at  the  bottom  to  look  at  those  at  the  top,  screaming  "  mo- 
nopoly," merely  to  excite  their  envy  and  discontent,  stop  its  revo- 
lutions, and   keep  both  where   they  were.     In   the  meantime,  the 
foreigner  gets  rich  out  of  the  sweat  of  the    American    laborer's 
brow,  while  all  things  at  home  remain  in  statu  quo.     The  dema- 
gogue will  not  allow  American  wealth  to  employ  American  labor, 
at  American   prices  ;   and  as  a  consequence,  it  is  obliged  to  sell 
itself  in  the  European   market,  at    European    prices ;    while    the 
things  it  gets  in  exchange  from  Europe,  as  is  shown  in  another 
place,  are  higher  than  they  would  be  under  a  system  of  protection 
at  home.     In  this  way  American  labor  is  a  loser  twice  over — 
thrice,  indeed :  First,  by  being  robbed  of  that  employment  which 
gives  fair  wages  ;  next,  by  being  dragged  down   to  a  level  with 
European  labor;  and  last,  not  least,  by  being  knocked  off  from  the 
American  wheel  of  fortune,  and  deprived  of  all  its  chances.     The 
last  is  an  utter  extinction  of  the  hopes  of  rising. 


THE  CLAIMS  OF  AMERICAN  LABOR  FOR  PROTECTION.       321 

The  very  charge  brought  against  capitalists,  viz.,  the  crime  of 
being  rich,  is  that  which  makes  them  a  blessing  to  labor,  while  they 
are  willing  to  employ  it.  They  who  put  obstacles  in  the  way  of 
this  relation,  by  refusing  that  protection  which  is  necessary  to  it, 
are  the  enemies  of  labor.  Besides  being  vicious,  they  are  stupid, 
and  do  not  think,  that,  in  preventing  the  investment  of  American 
capital  in  a  way  to  employ  American  labor,  they  only  stimulate  the 
use  of  foreign  capital  and  the  employment  of  foreign  labor,  to 
supply  the  same  wants  which  might  be  supplied  from  domestic 
sources  ;  and  that,  in  keeping  money  out  of  the  hands  of  Ameri- 
cans, they  put  it  in  the  hands  of  foreigners,  banishing  so  much 
capital  from  this  country,  to  replenish  foreign  exchequers,  to 
augment  the  splendors  of  foreign  aristocracies,  and  the  power 
of  foreign  despotisms,  all  at  the  expense  of  the  American  people. 
In  attempting  to  cripple  American  capitalists,  they  not  only  cripple 
and  impoverish  American  labor,  but  enrich  foreign  capitalists  and 
foreign  factors,  and  put  additional  millions  into  the  coffers  of  for- 
eign millionaires,  all  drawn  from  the  hand  of  American  toil. 

21 


322  BALANCE  OF  TRADE. 


CHAPTER    XXI. 

BALANCE    OF    TRADE. 

The  Balance  of  Trade  a  well  known  Principle  in  common  Life — The  Efforts  made  to 
mystify  the  Subject. — Adam  Smiih  and  liis  School  admit  the  Piinciple  unawaies. — The 
only  Difficulty  is  an  imperfect  \  iew  of  the  Facts  that  belong  to  the  Cluestion — The 
Difficulty  in  England  not  found  in  the  United  States,  and  is  now  removed  there. — Prac- 
tical Men  always  Right  on  this  Subject — Instance  the  London  Times — Adam  Smith's 
"  Wherewithal  ■' — The  Free-Trade  Economi.-ts  fail  to  distinsui.sii  between  Money  as  a 
Subject  and  as  the  Insti-ument  of  Trade,  in  all  their  Rea.wuiiigs  on  this  Q.ue.-tiiin  — Adam 
Smith  li  ts  the  Cat  out  of  the  Bag,  by  an  Hypothesis. — Tlie  Kf-y  of  this  Hypothesis. — Ad- 
am Smith  makes  Lo.ss  Evidence  of  Gain. — Joshua  Gee's  Po-ition  and  Hea«oiiing  as  a 
British  Economist. — He  the  British  Oracle. — His  Policy  for  America — The  Co'nage  of 
a  Nation  Evidence  of  its  profitable  or  unprofitable  Trade — M  Say's  Reasojjing  on  the 
Balance  of  Trade. — Its  Absurdity. — Adam  Smith  the  original  Author  of  this  Fallacy  — 
How  One  rides  a  Hobby. — A  Citizen  may  be  enriched  by  the  same  Act  that  subtracts 
from  the  Wealth  of  the  Nation. — So  of  a  Class  of  Citizens. 

That  a  principle  so  plain  as  that  of  a  balance  of  trade,  should 
be  contested,  and  even  denied,  as  a  fact  that  can  have  no  existence 
in  social  and  public  economy,  is  one  of  those  extravagances,  which 
could  nowhere  else  find  a  place,  except  in  the  minds  of  men  who 
subsist  in  a  world  of  dreams,  rather  than  in  a  world  of  reality. 
The  principle,  in  its  practical  application,  lies  within  the  range  of 
every  one's  daily  experience  and  observation.  There  is  not  a  sin- 
gle man,  in  any  community,  failing  in  business,  or  more  technically, 
becoming  a  bankrupt,  who  is  not  an  example  of  the  operation  of 
this  principle.  Why  is  he  a  bankrupt?  Simply  because  he  has 
not  paid  respect  to  the  principle  of  the  balance  of  trade.  If  he  had 
regarded  that,  and  not  run  in  debt  beyond  his  means,  he  never 
would  have  been  a  bankrupt.  By  this  neglect,  and  by  overtrading, 
he  has  rendered  him.^elf  liable  to  demands  in  cash,  beyond  his  abil- 
ity to  meet,  and  he  is  obhged  to  stop  payment.  He  is  a  bankrupt. 
The  reason  is  simply,  that  a  balance  of  trade,  by  his  own  improv- 
idence, or  misfortune,  has  overtaken  him,  which  he  can  not  en- 
counter. 

Great  efforts  have  been  made,  but  without  avail,  by  European 
Free-Trade  economists  and  their  disciples  in  this  country,  to  mys- 
tify the  argument  founded  on  the  balance  of  trade,  and  thereby  to 
abate  its  force.  Adam  Smith  admits  all  we  want  on  this  question, 
as  indeed  he  does  on  almost  every  other  on  which  he  attempts  to 


BALANCE    OF    TRADE.  323 

establish  a  doctrine  from  which  we  feel  obliged  to  dissent.  It  is  so 
generally  with  his  school  :  their  isolated  propositions  are  quite  suf- 
ficient for  our  purpose  on  almost  all  the  subjects  in  controversy. 
An  estopel  from  their  own  words  is  doubtless  the  best  kind  of  an- 
swer against  those  who  have  been  so  unfortunate  as  to  answer 
themselves.  On  the  balance  of  trade,  Adam  Smith  says  :  "  The 
ordinary  state  of  debt  and  credit  between  any  two  places  [or  na- 
tions], is  not  always  entirely  regulated  by  the  ordinary  course  of 
their  dealings  with  one  another;  but  is  often  influenced  by  that  of 
the  dealings  of  either  with  many  other  places"  [or  nations].  Noth- 
ing can  be  more  true  than  this  ;  and  nothing  more  true  than  that 
it  discloses  the  only  difficulty  in  the  debate,  viz.,  an  imperfeci  view 
of  the  facts  that  belong  to  the  question.  It  is  the  whole  commerce 
of  a  nation  with  all  the  world  foreign  to  itself,  that  requires  to  be 
considered,  when  the  balance  of  trade  is  sought  for,  in  the  same 
manner  as  in  the  case  of  an  individual.  It  will  not  do  for  a  mer- 
chant to  consider  only  a  part  of  his  transactions,  to  know  how  he  is 
to  come  out.  He  must  consider  them  all.  With  all  the  facts  in 
hand  which  are  comprehended  in  this  aggregate  of  a  nation's  for- 
eign commerce,  or,  which  is  the  same  thing,  with  correct  tables  of 
imports  and  exports,  in  connexion  with  a  true  estimate  of  their  re- 
spective values,  taking  into  consideration  also  a  true  account  of  the 
distribution  of  the  profits  of  the  carrying  trade  between  home  and 
foreign  parties,  the  rule  claimed  to  arise  from  the  balance  of  trade, 
to  determine  whether  a  nation  is,  on  the  whole,  and  as  a  whole, 
doing  a  profitable  or  unprofitable  business,  with  foreign  parts,  is 
precisely  the  same,  and  equally  infallible,  as  that  which  arises  from 
the  well-kept  books  of  a  counting-house,  to  determine,  by  the  bal- 
ances, whether  the  merchant  or  firm  is  making  or  losing  money. 
Nor,  so  far  as  we  can  observe,  is  it  pretended,  that  the  rule  is  not  a 
good  and  true  one,  on  these  conditions.  The  only  objection,  ap- 
parently, is,  that  the  facts  which  constitute  the  rule,  are  not  always 
reliable  for  the  end  in  view,  because  they  can  not  be  accurately  as- 
certained. 

There  was  a  reason  in  England  for  saying  the  official  records' 
are  not  reliable  for  such  a  purpose,  which  does  not  exist  in  the 
United  States,  nor,  so  far  as  we  know,  anywhere  else.  In  1G94,  a 
law  was  passed,  requiring  all  entries  to  be  made  in  the  custom- 
house according  to  the  prices  then  fixed,  which  is  still  in  force. 
This,  ever  since,  has  caused  material  variations  between  tl)e  official 
and  real  or  declared  values,  increasing  as  time  advanced,  and  every 


324  BALANCE    OF    TRADE. 

year  fluctuating.  But,  from  1801  to  1845,  inclusive,  Porter,  the 
latest  authority,  gives  the  "  real  or  declared  value,"  as  they  call  it, 
in  a  separate  column,  though  only  for  the  exports.  The  "  real  or 
declared"  value  of  the  imports  for  these  same  years,  we  suppose, 
can  be  obtained  by  a  like  rule.  It  is  no  more  true,  however,  that 
British  economists  may  have  been  somewhat  embarrassed  by  this 
mode  of  keeping  the  customhouse  books,  than  that  there  is  no  oc- 
casion fur  such  embarrassment  in  the  case  of  the  American  records 
of  the  same  class  ;  and  since  they  also  have  in  England  the  real  or 
declared  valuation,  certainly  of  late  years,  it  is  not  easy  to  see  why 
they  should  object  to  this  rule. 

That  there  may  be  some  difficulty  in  ascertaining  all  the  facts, 
with  perfect  accuracy,  is  not  denied  ;  but  the  principle  of  the 
rule  is  undoubtedly  a  correct  one  ;  and  it  is  claimed,  moreover, 
that  the  facts  which  belong  to  the  case,  in  the  United  States,  can 
be  ascertained  with  sufficient  accuracy  to  answer  the  purpose  in 
view,  inasmuch  as  perfect  accuracy  is  not  required.  The  bal- 
ances, imperfect  as  the  means  of  ascertaining  them  are,  yet  with 
such  helps  as  can  be  obtained,  are  generally  so  obvious,  that  all 
the  objections  that  have  been  made  to  the  rule,  are  utterly  futile. 

Take,  for  example,  the  balances  in  the  commercial  history  of 
the  United  States,  as  they  relate  to  our  foreign  trade,  which  will  be 
found  in  chapter  xxiv.     The  main  points  of  defect  or  inaccuracy 
in  the  tables  cited,  are  such  as  throw  the  loss  almost  entirely  on  the 
side  of  the  argument  we  are  endeavoring  to  sustain,  and  of  course 
impair  it,  first,  because  it  is  in  evidence  that  an  average  of  some 
ten  millions  a  year,  for  a  considerable  time,  has  been  left  out  of  the 
table  of  imports,  which   ought  to  be  there  ;  and  the  same  defect 
may  run  back  through  the  whole  period  ;  while  there  is  no  evi- 
dence of  a  like  defect  in  the  table  of  exports,  nor  would  it  naturally 
or  easily  occur,  as  it  would  be  without  motive  or  necessity.     But, 
in  the  second  place,  it  is  proved  in  various  ways  —  proved  in  courts 
of  justice  —  that  a  very  large  proportion  of  the  imports,  is  always 
undervalued  in  the  foreign  invoices  on  which  they  are  entered,  for 
the  purpose  of  lessening  the  amount  of  duties  to  be   paid.     If, 
therefore,  for  the  sake  of  brevity,  as  well  as  obvious  fairness  to  op- 
ponents, we  take  the  tables  as  they  are,  and  allow  all  that  was 
earned  in  freight  by  American  shipping,  and  all  the  avails  of  the 
fisheries,  to  balance  the  two  important,  and  doubtless  much  larger, 
items  above  named  as  defects  on  the  other  side,  there  is,  then,  noth- 
ing else  worthy  of  mention,  affecting  the  accuracy  of  the  rule.     We 


BALANCE    OF    TRADE.  325 

are  aware,  indeed,  that  the  British  economists — some  of  them  at 
least  —  speak  of  the  profits  of  the  merchants  as  belonging  to  this 
reckoning.  But  all  the  profits  of  the  American  importer  fall  as 
much  witliin  the  scope  of  the  home  trade  as  any  other  domestic 
transaction  —  for  the  transaction  that  makes  his  profit  is  domestic, 
between  him  and  the  American  people;  and  as  to  the  profits  of  the 
foreign  factor,  who,  hitherto,  has  made  more  than  the  American 
importer,  he  carries  it  all  out  of  the  country,  which,  for  this  reason, 
should  not  be  mentioned  by  our  opponents,  who  only  lose  by  it  in 
the  argument,  and  help  our  side. 

But  suppose  that,  for  other  reasons — though  we  do  not  see  where 
they  can  be  found  —  the  relative  augmentation,  when  perfect  accu- 
racy is  obtained,  should  be  on  the  side  of  the  exports,  still  the  dif- 
ference between  the  two  is  so  prodigious,  that  the  general  result 
could  not  be  materially  affected  ;  and  the  domestic  history  of  the 
country,  as  to  its  periods  of  commercial  prosperity  and  adversity, 
corresponds  so  well  with  the  assumption,  that  these  tables,  on  the 
whole,  are  a  pretty  fair  exhibit,  as  to  impart  to  them  a  strong  pre- 
sumptive sanction. 

It  is  remarkable  how  practical  men  can  never  express  themselves, 
when  the  effects  of  disturbing  the  balance  of  trade  are  apparent, 
without  calling  it  involuntarily,  and  as  a  matter  of  course,  by  that 
name  ;  and  not  less  remarkable  how  asoi-Jisant.  Free-Trade  nation 
will  itself  do  it  by  the  mouth  of  its  organs.  For  example,  the 
London  Times  of  January  19,  JS47,  devotes  a  column  to  the  sub- 
ject, all  under  this  name,  without  thinking  of  its  inconsistency  with 
the  Free-Trade  theory.  It  finds  "  the  balance"  disturbed  by  send- 
ing, as  a  loan,  one  million  sterling  of  bullion  from  the  bank  of  Eng- 
land to  the  bank  of  France.  The  money-market  feels  it;  interest 
rises  from  3  to  3|  per  cent. ;  and  there  is  "  almost  a  panic."  How 
much  more,  that  journal  says,  when  the  other  two  or  three  millions, 
promised,  shall  go  ?  It  predicts,  that,  in  the  course  of  the  year 
1847,  there  will  be  "  a  balance  of  trade"  against  England  of  sev- 
enteen millions  sterling  ;  that  there  will  be  a  crisis,  and  great  com- 
mercial distress  ;  and  recommends  that  every  effort  should  be  made 
to  discourage  and  check  imports,  so  as  to  reduce  this  anticipated 
*'  balance."  This  is  very  inconsistent  language  for  a  Free-Trade 
country,  and  a  Free-Trade  journal.  It  only  shows,  that  when  the 
pressure  of  reality  comes,  they  can  not  help  calling  things  by  their 
right  names.  Even  the  export  of  so  small  a  sum  as  one  million 
sterling,  produces  "  almost  a  panic."      This  trifling  loss  of  bullion. 


326  BALANCE    OF    TRADE. 

or  specie,  would  not  be  felt  in  o  dinary  times;  but  in  consequence 
of  tbe  potato-rot  and  scarcity  of  bread-stuffs  in  Great  Britain,  she 
is  not  only  paying  higher  for  her  necessary  supplies,  but  is  obliged 
to  buy  more  than  usual  ;  in  other  words,  she  buys  more  llian  slie 
sells,  imports  more  than  she  exports,  which  brings  "  the  balance 
of  trade"  against  ber.  Every  million  of  money,  therefore,  that  is 
exported  at  such  a  time,  to  settle  balances  in  the  United  States  or 
elsewhere,  for  breadstuffs,  is  felt,  and  threatens  a  crisis  —  occasions 
a  panic.  Why?  —  Because  there  is  such  a  thing  as  a  favorable 
or  unfavorable  balance  of  trade  between  one  nation  and  all  others 
—  a  state  of  things  easily  and  universally  recognised.  In  practice, 
in  the  current  of  events,  whether  it  be  one  way  or  the  other,  all  see 
and  feel  it;  while  in  theory,  it  is  denied.  Why  does  not  Great 
Britain  stand  by  her  own  jiroclaimed  theory,  at  such  a  time,  and 
not  be  so  sensitive  because  of  this  draught  on  her  bullion,  or  S|)ecie  ? 
Tliere  can  be  no  danger  from  i\\\i  course,  according  to  the  doc- 
trine of  her  Smiths,  her  Ricardos,  and  her  M'Cullochs.  But 
practice,  experience,  is  found  to  be  a  very  different  thing  from 
a  Free-Trade  theory.  In  doctrine  they  say,  Free  Trade  always 
balances  itself;  in  practice,  they  dare  not  trust  it. 

Precisely  according  to  these  predictions  the  crisis  came,  and  the 
commercial  condition  of  England  never  received  a  greater  shock 
than  in  1847,  all  from  an  unfavorable  balance  of  trade,  inducing 
laro;e  exports  of  specie,  of  which  some  2U  to  25  millions  of  dollars 
came  to  the  United  States  to  pay  for  bread-stuffs.  And  yet  every- 
one of  our  Free-Trade  economisis  say,  this  was  no  disadvantage, 
because  the  money  was  exported  as  a  commodity. 

But  Adam  Smith  l)as  given  up  the  question,  as  follows  :  "  It 
would,  indeed,  be  more  advantageous,"  he  says,  "  for  England, 
that  it  could  purchase  the  wines  of  France  with  its  own  hardware 
and  broadcloth,  than  with  either  the  tobacco  of  Virginia,  or  with 
the  gold  and  silver  of  Brazil  and  Peru."  —  "As  a  country  which 
has  wherewithal  to  buy  tobacco,  will  never  be  long  in  want  of  it ; 
so  neither  will  one  be  long  in  want  of  gold  and  silver  which  has 
wherewithal  to  purchase  these  metals."  The  first  of  these  ex- 
tracts needs  no  comment.  The  simplicity  of  the  second,  however, 
is  really  too  remarkable  to  be  passed  over  without  notice.  In  the 
first  place,  it  begs  the  question  :  a  nation  will  not  want  money  that 
has  wherewithal  to  purchase  it.  Nor  will  a  beggar  in  the  streets. 
These  Free-Trade  economists  say,  and  say  truly,  that  money  is  a 
commodity,  and  as  much  a  subject  of  trade  as  any  other  commod- 


BALANCE    OF    TRADE.  327 

ity  ;  but  why  should  they  fail  to  consider,  that  it  has  attributes,  and 
discharges  functions,  by  the  common  consent  of  mani<in(l,  which 
can  be  ascribed  to  no  other  commodity  ?*  Why  should  they  fail 
to  consider  the  consequences  resulting  from  the  facts,  that  it  is  a 
common  currency  throughout  the  world,  in  the  negotiaiion  of  ex- 
changes of  all  other  commodities,  and  that  it  is  the  only  thing  to 
settle  balances,  when  barter  is  declined  by  a  creditor? 

If  the  United  States  is  in  the  habit  of  buyin<j  annuallv  more 
than  it  sells,  or  can  sell,  and  has  no  money  to  spare  from  its  own 
bo-om,  how  are  these  balances  to  be  settled  ?  —  That  is  tlie  ques- 
tion. Adam  Smith  and  others  of  his  school  answer,  that  we  shall 
not  long  want  the  money,  if  we  have  wherewithal  to  buy  it.  This 
is  only  another  form  of  putting  the  same  question,  and  it  is  a  prob- 
lem still.  Certainly,  it  is  not  helping  us  out  of  the  difficulty.  "  If 
we  have  wherewithal  to  buy  it;"  alifis,  if  there  be  a  market  for  our 
"wherewithal."  This  last  is  the  only  condition  on  which  Adam 
Smith  could  fairly  have  come  to  his  conclusion  ;  and  the  very  case 
supposes,  that  this  condition  is  out  of  the  question.  Money  in 
abeyance  is  the  correlative  of  the  "  wherewithal  ;"  and  since  the 
money  is  not  in  abeyance,  or  if  it  be  not,  it  is  impossible  thatvve 
shoulii  have  the  "  wherewiti)al,"  It  is  clear,  if  the  money  had 
been  in  abeyance  to  anything  we  had  to  give  for  it,  it  would  have 
been  realized.      The  case  supposed,  therefore,  could  not  possibly 

OCCtU'. 

This  apparent  failure  of  the  Free-Trade  economists  to  recognise 
the  peculiar  and  exclusive  functions  of  money,  in  the  market  of 
the  world,  and  their  pertinacity  in  ranking  it  with  all  other  ex- 
changeable commodities,  would  seem  to  have  been  the  occasion  of 
this  very  erroneous  conclusion,  that  it  is  equally  obtainable  by 
other  commodities,  as  others  are  by  itself.  There  is  no  exchange- 
able commodity  w  hich  money  can  not  buy  ;  but  it  may  happen  that 
all  the  commodities  a  man  or  a  nation  may  have,  can  not  buy 
money,  unless  it  be  at  ruinous  prices,  and  that  to  a  limited  extent, 
simply  because  there  is  no  market,  no  demand  for  them,  where 
money  will  be  given. 

This  fallacious  doctrine,  it  seems,  was  in  vogue  when  Joshua 
Gee  published  his  work  entitled  "  Trade  and  Navigation  of 
Great  Britain,"  and  he  declares  that  he  undertook  it  express- 
ly to  expose  this   error.      He    says :    "  So   mistaken   are    many 

*  For  the  distinction  between  money  as  a  subject  and  as  the  instrument  of  trade, 
see  chapter  xiv. 


328  BALANCE    OF    TRADE. 

people,  tliat  tliey  say,  money  is  a  commodity  like  other  things,  and 
think  themselves  never  the  poorer  for  what  the  nation  daily  ex- 
ports," of  the  precious  metals.  He  tlierefore  says  :  "  I  iiave 
thougiit  the  only  method  to  furnish  gentlemen  with  proper  consid- 
erations, is  to  give  some  account  of  the  commodities  the  nations 
we  trade  with  take  from  us,  and  what  we  take  from  them,  and  to 
give  my  thoughts  where  I  think  the  halance  hes."  And  he  did 
so,  to  the  full  conviction  of  all  British  statesmen,  who,  in  their 
legislation,  have  adhered  to  Gee's  doctrine,  from  that  time  to  the 
present.  Any  one  can  see,  that  a  true  account  of  the  foreign  trade 
of  Great  Britain,  or  of  any  other  nation,  according  to  this  plan  of 
Joshua  Gee,  that  is,  "of  the  commodities  the  nations  we  trade 
with  take  from  us,  and  what  we  take  from  them,"  will  show  whether 
that  nation  is  gaining  or  losing  by  its  foreign  commerce.  If  it  gets 
an  annual  balance  of  money,  it  is  gaining  ;  if  it  parts  with  an  annual 
balance  of  money,  it  is  losing. 

Among  the  many  true  things  which  Adam  Smith  has  said  — 
and  he  has  said  enough  for  all  our  purposes  —  nothing  is  more 
true  than  the  following: — 

*'  The  balance  of  produce  and  consumption  [home  produce  and 
consumption]  may  be  constantly  in  favor  of  a  nation,  though  what 
is  called  the  balance  of  trade  [its  foreign  trade]  be  against  it.  A 
nation  may  import'to  a  greater  value  than  it  exports  for  half  a  cen- 
tury, perhaps,  together  ;  the  gold  and  silver  which  comes  into  it  all 
this  time,  may  be  all  immediately  sent  out  of  it ;  its  circulating  coin 
may  gradually  decay,  different  sorts  of  paper-money  being  substi- 
tuted in  its  place  ;  and  even  the  debts,  too,  which  it  contracts  in 
the  principal  nations  with  which  it  deals,  may  be  gradually  increas- 
ing;  and  yet  its  real  wealth,  the  exchangeable  value  of  the  annual 
produce  of  its  land  and  labor,  may,  during  the  same  period,  have 
been  increasing  in  a  much  greater  proportion.  The  state  of  our 
North  American  colonies,  and  of  the  trade  which  they  carried  on 
with  Great  Britain,  bef)re  the  commencement  of  the  present  dis- 
turbances [this  was  written  in  1777],  may  serve  as  a  proof,  that 
this  is  by  no  means  an  impossible  supposition." 

Apropos.  This  is  the  more  valuable,  not  only  as  coming  from 
such  authority,  but  as  being  the  best  possible  description  of  our 
own  case,  such  as  it  was  before  the  revolution,  such  as  it  was  un- 
der the  confederation,  and  such,  to  a  great  extent,  as  it  has  been, 
even  under  the  operation  of  the  federal  constitution,  down  to  this 
time,  for  want  of  adequate  protection.     Exactly  so.      Such  were 


BALANCE    OF    TRADE.  329 

the  enterprise,  industry,  and  other  virtues  of  the  American  fathers, 
and  such  the  resources  and  ca[nibihtie3  of  the  country,  that  they 
improved  their  lands,  built  houses  and  towns,  and  created  a  great 
amount  of  permanent  wealth,  which  could  not  be  conveniently  car- 
ried away,  and  wijich  remained  behind,  notwithstanding  all  their 
wrongs.  Exactly  so.  "  The  circulating  coin  gradually  decayed" 
for  fifty  years^or  more,  "  different  sorts  of  paper-money  being  sub- 
stituted in  its  place."  Exactly  so.  "  Even  the  debts  contracted 
with  the  principal  nations,"  Great  Britain  cliiefly,  "  with  which  they 
dealt,  gradually  increased."  Exactly  so.  "  And  yet  the  real 
wealth  [llie  permanent  wealth],  the  exchangeable  value  of  the  an- 
nual produce  of  land  and  labor  may,  during  that  period,  have  been 
increased  in  a  much  greater  proportion."  ]t  doubtless  increased, 
in  either  greater  or  less  proportion,  as  compared  with  the  increase 
of  these  fortign  debts,  chiefly  contracted  with  the  mother-country 
—  probably,  in  a  greater  proportion.  Certainly,  it  would  have 
been  a  harder  case;  than  was  alleged,  and  is  generally  supposed,  if 
it  did  not.  And  was  this  the  grace  done  to  the  colonists,  that  the 
mother-country  did  not  carry  away  their  houses,  and  other  perma- 
nent fixtures,  created  by  their  industry  and  labor  ;  but  only  took 
away  their  money  —  everything  that  could  be  taken,  and  run  them 
in  debt  —  debts  constantly  increasing  for  half  acentury  —  to  absorb 
all  the  money  as  fast  as  it  should  come  in  —  and  left  the  colonists, 
not  exactly  like  the  Mexicans  in  California,  with  hides  for  a  curren- 
cy, but  with  that  which  was  worse,  and  good  for  nothing,  "  differ- 
ent sorts  of  paper-money,"  that  had  no  specie  basis. 

Yes,  verily,  nothing  could  be  more  true  than  this  description,  by 
Adam  Smith,  of  the  state  of  the  colonies  before  the  revolution.  It 
was  this  very  stale  of  things  that  occasioned  the  revolution.  And 
yet  Adam  Smith,  an  economist  of  the  highest  pretensions,  and  of 
a  universal  credit  that  has  run  down  through  three  fourths  of  a 
century,  has  the  audacity  to  adduce  this  condition  of  the  colonists, 
not  only  as  a  reason  why  they  ought  to  have  been  very  contented, 
but  as  irrefragable  proof,  according  to  his  theory,  of  their  prosperity 
and  increasing  wealth  !  It  is  no  matter,  according  to  him,  how 
much  the  foreign  balances  are  against  the  country;  or  how  large 
the  foreign  debts,  and  how  much  they  are  increasing ;  or  though 
all  the  precious  metals,  as  fast  as  they  come  in,  be  drawn  away 
from  the  country  by  these  debts  ;  or  though  the  circulating  medi- 
um, by  such  a  cause,  be  composed  of  irredeemable  paper,  not  really 
worth  a  penny  ;  —  all  tliis  is  no  matter,  according  to  Adam  Smith, 


330  BALANCE    OF    TKADE. 

provided  the  nation  or  state  is  creating  permanent  fixtures,  at  home, 
of  the  nature  of  wealth,  equal  to  or  greater  than  the  debts  which  it 
is  creating  abroad  !  A  real  calculating  Yankee  would  not  only 
want  his  fixtures,  his  permanent  capital,  but  he  would  want  money 
to  do  business  with,  instead  of  contracting  debts,  to  hang  as  a 
millstone  about  jiis  neck,  and  prevent  his  prDsperity.  It  would  be 
no  great  comfort  to  him  to  live  in  a  house,  and  work  a  farm,  which 
he  could  not  call  his  own,  because  both  were  mortgaged.  And 
yet  Adam  Smith  calls  this  prosperity,  increase  of  wealth  ! 

The  key  to  this  remarkable  argument  of  Adam  Smith,  as  well 
as  to  his  entire  work,  will  be  found  in  chapter  v.,  where  it  is  shown, 
that  he  was  doubtless  in  the  service  of  the  British  government,  in 
the  production  of  his  "  Wealth  of  Nations;"  that  his  main  object 
was  to  satisfy  the  discontented  colonists,  and  to  convince  them  tliat 
they  were  doing  well,  notwithstanding  all  their  alleged  groimds"  of 
complaint.  It  will  be  observed,  that  be  sets  up  an  h)  pothesis,  in 
the  foregoing  extract,  and  then  brings  in  the  case  of  the  North 
American  colonies  to  verify  it.  The  simple  truth  is,  that,  in  the 
hypothesis,  he  was  describing  the  very  case  of  the  colonies,  and 
had  that  only  in  view.  He  deserves  the  credit  of  reporting  the 
case  truly,  exactly  as  it  was.  It  is  true,  as  he  says,  they  had  no 
money  for  fifty  years  ;  that  they  were  all  the  while  running  in  debt ; 
that  as  fast  as  money  came  in,  it  was  obliged  to  go  out ;  that  they 
were  compelled  to  resort  to  rag-money,  without  a  specie  basis  ;  and 
that  they  were  building  houses,  and  improving  their  lands,  in  the 
meantime.  But  the  insult  done  to  them,  by  this  argument,  is  tel- 
lino-  them,  that,  under  all  these  hardslii;)S  and  wrongs,  which  they 
thought,  and  fully  believed,  justified  a  rebellion  against  the  British 
crown,  they  were  doing  very  well,  growing  rich,  and  ought  not  to 
complain  ! 

In  view  of  the  evidence  presented  in  chapter  xxiv.,  it  hardly 
need  be  said  that  the  commercial  history  of  the  United  States,  so 
far  as  it  regards  our  foreign  trade,  for  a  large  portion  of  the  period 
since  the  establishment  of  Inde[)endence,  is  very  like  the  case  de- 
scribed above  by  Adam  Smith,  as  being,  in  his  opinion,  and  ac- 
cording to  his  theory,  so  pleasant,  so  prosperous,  and  so  desirable 
a  state  of  the  colonies.  Notwithstanding  the  immense  balances 
against  us,  which  we  have  had  to  pay,  or  have  run  in  debt  for  — 
a  part  of  them  is  now  outstanding — we  have  worked  hard  and 
got  together  a  good  deal  of  wealth.  It  would  be  much  more  con- 
solin"-,  if  a  part  of  these  balances  against  us  had  really  added  to 


BALANCE    OF    TRADE.  331 

the  permanent  wealth  of  the  country,  by  having  been  created  for 
imports  of  a  durable  kind,  entering  into  permanent  fixtures  and 
productive  of  wealth.     But  it    will  be  found,  on  examining  the 
official  tables  which  give  instruction  on  this  point,  that,  whe'Jever 
our  imports  have  risen  above  the  exports,  more  or  less,  the  increase 
was  chiefly  on  perishable  articles,  such  as  silks,  cloths,  wines,  &c., 
being  chiefly  of  the  same  character  with  the  wasteful  expenditures 
of  the  spendthrift,  which  leave  no  good  behind,  but  incur  incon- 
venient  obligations  for  the  future.      The    silks    brought  into  the 
country  in  that  remarkable   period   of  excess  of  imports  over  ex- 
ports, from  1833  to  1834,  inclusive,  amounted  to  $105,000,000  ; 
woollen  cloths,  for  the  same  time,  to  $102,000,000;  cotton  cloths,' 
for    same    time,    to    $83,000,000;    linens,    for    same    time,    to 
$41,000,000  ;  wines,  for  same  time,  to  $22,000,000  ;  and  so  on; 
each  of  these  being,  two  and  three  to  one  of  their  usual  propor- 
tion of  imports.     It  is  also  made  evident,  by  the  same  scrutiny, 
that,  under  an  adequate  system  of  protection,  we  could  have  saved 
this  balance  against  us,  and  turned  it  the"  other  way,  by  domestic 
productions  at  cheaper  rates,  and  better  in  kind,  which  would  not 
only  have  retained  in  the  country  all  the  capital  comprehended  in 
these  unfavorable  balances,  to  have  made  us  so  much  richer  ;  but 
the  use  of  this  capital   at  home  would  have  multiplied  itself  many 
times;  all  which,  that  is,  the  original    capital  and  its  contingent, 
proceeds,  are  for  ever  lost  — not  to  speak  of  the   immense  "and 
long-protracted   system   of  foreign  taxation,   as   noticed  in  chapter 
xxiv.,    to  which    we  have  been    subjected  thereby.     Nor  is  this 
all :  the  injury  done  by  a  several  times  breaking  down  of  the  cur- 
rency, occasioned  by  this  sole  cause,  is  incalculable. 

Doubtless,  there  was  more  wealth  created  at  home,  during  each 
of  those  years  of  excessive  imports,  and  during  all  others  in  our 
history,  than  was  thus  wasted  abroad  —  and  much  worse  than 
wasted,  because  it  embarrassed  the  country.  But,  according  to  the 
rule  of  Adam  Smith;  and  of  those  of  his  faith,  the  wealtirwhich 
the  people  created  at  home,  in  spite  of  a  bad  public  policy,  and  in 
spite  of  the  general  losses  and  misfortunes  occasioned  by  these 
immense  draughts  on  the  country,  from  foreign  parts,  the  two  things 
put  together,  gain  on  one  side  and  loss  on  the  other,  are  evidence 
of  prosperity  and  increasing  national  wealth.  The  remarkable 
part  of  the  rule  is,  that  the  loss  should  be  evidence  of  gain  !  So 
Adam  Smith  represents  it. 

One  is  at  loss  to  know  what  Adam  Smith's  notions  of  balance 


332  BALANCE    OF    TIIADE. 

of  trade  were.  For  example,  he  says  :  "  Among  all  the  absurd 
speculations  that  have  been  propagated  concerning  the  balance  of 
trade,  it  has  never  been  pretended  that  either  the  country  loses  by 
its  commerce  with  the  town,  or  the  town  by  that  of  the  country 
which  maintains  it."  If  he  knew,  as  he  certainly  ought  to  have 
known,  that  this  is  not  a  parallel  case,  it  might  seem  very  unex- 
pected trifling  for  him  to  make  such  a  comparison  ;  and  if  he  did 
not  know,  one  can  hardly  see  how  he  was  qualified  to  speak  on  the 
subject. 

The  position  occupied  by  Joshua  Gee  as  a  British  economist, 
and  the  potent  influence  which  he  wielded  in  reviving  the  British 
protective  system,  and  placing  it  on  a  foundation  which  has  made 
that  empire  the  most  powerful  in  the  world,  are  worthy  of  particu- 
lar notice.  His  work  was  published  by  himself  in  1730,  and  the 
sixth  edition,  1755,  the  one  before  us,  was  the  second  or  third  that 
appeared  after  his  death.  Gee  had  co-workers,  before  and  after, 
such  as  Child,  ]\Iun,  Smith,  Temple,  Cantillon,  and  Mildmay; 
but,  not  having  their  works  in  hand,  we  can  not  speak  of  their 
merits.  Much  care  was  taken  by  Edward  III.,  to  protect  trade, 
and  in  the  28th  year  of  his  reign,  the  exports  were  as  7  to  1  of 
imports.  Under  Elizabeth,  the  protective  policy  was  systematized, 
and  vigorously  applied,  to  the  great  advantage  of  her  kingdom, 
and  strength  of  her  administration.  This  policy  was  continued  for 
full  half  a  century  after  her  demise.  It  appears  from  Gee,  that, 
from  the  41st  year  of  her  reign,  1599,  the  coinage  —  which  Gee 
makes  a  rule  of  national  prosperity  —  continued  to  increase,  down 
to  1657  ;  and  that  from  1667  to  1675,  it  fell  off  to  an  alarming 
degree.  It  would  seem,  that,  for  some  time  after  this,  the  nation 
was  in  a  bad  way,  as  to  its  foreign  trade.  Gee  says:  "In  1716, 
the  lords  of  trade  sent  for  sundry  persons  to  consult  with  them. 
Among  the  rest  I  was  also  required  to  give  my  thoughts  ;  and  af- 
ter I  had  given  them  the  best  information  I  was  then  capable  of, 
they  ordered  me  to  commit  ic/iat  I  had  said  to  writing,  and  to  lay  il 
be/ore  them.  After  delivering  the  said  memorial,  I  was  frequently 
required  to  give  my  thoughts,  the  answers  to  which  are  contained 
in  these  chapters."  —  "The  printing  of  the  following  discourse 
was  not  with  a  design  to  publish  it,  much  less  to  presume  to  pre- 
sent it  to  the  king  ;  but  to  put  a  few  of  them  into  the  hands  of  the 
ministers  of  state,  and  other  great  men,  to  show  the  wounds  our 
trade  and  manufactures  had  received,  and  those  remedies  which 
may  soon  and  easily  be  obtained  ;  that  they  might  represent  them 


BALANCE    OF    TRADE.  333 

to  our  legislators,  who  have  it  in  their  power  to  make  us  a  rich  and 
flourishing  people.  After  I  had  delivered  a  kw  of  them,  I  un- 
derstood by  some  great  iiersons,  that  a  discourse  upon  trade  would 
be  acceptable  to  the  king,  and  albo  to  the  queen  and  prince.  It  was 
much  to  my  satisfaction,  that  I  had  louched  upon  a  subject  so 
agreeable  to  their  sentiments.  I  thought  it,  therefore,  my  duty  to 
present  this  treatise  to  their  royal  hands.  It  soon  got  abroad,  that 
I  had  writ  a  discourse  upon  '  the  trade  and  navigation  op 
Great  Britain,'  and  I  was  informed  if  I  did  not  permit  it  to  be 
published,  it  would  fall  into  such  hands  as  might  print  it,  and  alter 
mv  sense  and  intention." 

A  principal  object  of  Gee  see/ns  to  have  been  to  show  how  the 
American  colonies  and  plantations  might  be  made  to  contribute  to 
the  wealth  of  the  mother-country.  With  regard  to  the  general 
policy  he  proposed,  he  says:  "I  am  thoroughly  persuaded  the 
methods  herein  proposed  will  give  us  a  fair  prospect  of  outdoing 
any  nation  of  Europe."  At  that  time,  England  was  outdone  by 
France,  and  other  continental  powers,  which  had  taken  great  pains 
to  encourage  manufactures.  Gee  proposed  a  way  to  come  up  to 
and  get  before  them,  which  abundantly  succeeded. 

His  work  aims  to  establish  the  two  following  propositions:  1. 
*'  That  the  surest  way,"  &c.  (see  page  102).  These  propositions 
are  a  part  of  the  titlepage  of  the  work. 

Gee  saw  that,  in  his  time,  England  was  annually  paying  a  bal- 
ance of  trade  against  herself.  The  task  he  undertook,  in  proof  of 
the  above  propositions,  as  announced  by  himself,  was  to  give 
^'some  account  of  the  commodities  each  country  we  trade  with 
takes  from  us,  and  what  we  take  from  them,  with  observations  on 
the  balance."  The  balance  was  found  to  be  against  England.  * 
On  this  subject  he  says:  "To  take  the  right  way  of  judging  of 
the  increase  or  decrease  of  the  riches  of  the  nation,  by  the  trade 
w€  drive  with  foreigners,  is  to  examine  whether  we  receive  money 
from  them,  or  send  them  ours.  For,  if  we  export  more  goods 
than  we  receive,  it  is  most  certain  we  shall  have  a  balance  brought 
to  us  in  gold  and  silver,  and  the  mint  will  be  at  work  to  coin  that 
gold  and  silver.  But,  if  we  import  more  than  we  export,  or  spend 
our  money  in  foreign  countries,  then  it  is  certain  the  balance  must 
be  paid  by  gold  and  silver  sent  them  to  discharge  the  debt." 

The  foUowino;  citations  from  Gee  will  afford  some  notion  of  his 
policy  for  the  American  colonies  and  plantations,  which  seems  to 
have  been  adopted:  — 


334  BALANCE    OF    TRADK. 

"  Our  suf^ar  plantations  take  from  England  all  sorts  of  clothing-^ 
household  furniture,  and  a  great  part  of  their  food.  So  that  they 
are  entirely  dependent  upon  us."  Of  the  tobacco  plantations, 
Maryland  and  Virginia,  he  says:  "They  take  from  England  their 
elothin"-,  houseiiold  goods,  iron  manufactures  of  all  sorts,  saddles, 
bridles,  brass  and  copper  wares  ;  and  notvvilhstanding  their  dwel- 
ling among  the  woods,  they  take  their  very  turner's  wares,  and 
almost  everything  else  that  may  be  called  the  manufacture  of  Eng- 
land. England  takes  from  them,  not  only  what  tobacco  we  consume 
at  home,  but  very  great  quantities  for  re-exportation,  which  may 
properly  be  said  to  be  the  surest  way  of  enriching  this  kingdom." 
He  glorifies  the  trade  of  Pennsylvania  with  the  Spanish  West  In- 
dies, because  it  draws  gold  and  silver  from  the  Spanish  coast, 
"  which,"  he  says,  "  is  brought  home  by  our  trading  ships  from 
thence,  and  has  very  much  enlarged  their  demauds  upon  us  for 
broadcloths,  kersies,  druggets,  surges,  stuffs,  and  manufactures  of  all 
sorts."  Of  New  Jersey  and  New  York,  he  says  :  "  Their  traffic  is 
much  the  same.  We  have  what  money  they  can  raise,  to  buy  our 
manufactures  for  their  clothing;  and  vi^hat  they  further  want,  they 
are  forced  to  manufacture  for  themselves."  Of  New  Englaad  he 
says :  '*  She  takes  from  us  all  sorts  of  woollen  manufactures,  linen, 
sail-cloths  and  cordage  for  rigging  their  ships,  &c.  To  raise 
money  to  pay  for  what  they  take  of  us,  they  are  forced  to  visit  the 
Spanish  coast,  where  they  carry  any  commodity  they  can  trade 
with.  What  other  necessaries  they  want,  they  are  forced  to  man- 
ufacture for  themselves,  as  the  aforementioned  colonies." 

No  one  can  deny,  that  these  facts  are  in  excellent  harmony  witli 
the  description  of  the  colonies  by  Adam  Smith  ;  although  it  is  not 
so  easy  to  see  how  the  story  of  eitlier  is  proof  of  colonial  prosperity. 
Both  prove  that  England  got  all  the  money,  and  that  being  gone, 
that  the  colonists,  like  all  poverty-stricken  people,  did  as  well  as- 
they  could  without  money. 

The  following  from  Cee  is  to  the  same  point:  "It  is  absolutely 
necessary  that  ships  which  trade  between  the  plantations  and  any 
part  of  Europe,  shall  be  tied  down  by  the  strongest  penalties,  not 
to  return  again  to  the  plantations  without  taking  their  clearings 
from  some  port  in  Great  Britain.  For,  if  they  are  obliged  to  come 
hither  before  they  return,  they  will  bring  the  produce  of  their  car- 
gpes  with  them,  and  of  consequence  lay  it  out  with  us,"  &c. 
"  Queen  Elizabeth  was  the  first  crowned  jiead,"  says  Gee,  "  that 
gave  effectual  circulation  and  spirit  to  our  commerce.     She  knew 


BALANCE    OF    TRADE.  335 

tlie  right  way  to  enrich  a  nation,  was  to  send  out  as  many  of  our 
proiiur.ts  and  merchandise  as  possible,  and   looked  with  a  careful 
eye    upon   those   commodities   which    were  imported  for   luxury. 
The  queen,  observing  that  great  quantities  of  money  were  sent  out 
of  England  to  buy  silks  and  other  oudandish  wares,  and  that  many 
of  the  nobility  wasted  their  estates  and  run  much  in  debt,  she,  by 
proclamation,  commanded  all  persons  to  conform  to  a  certain  pre- 
scribed mode  of  apparel,  and  she  began  the  example  herself  in  her 
own  court.     Queen  Caroline  also  hath  given  a  most  noble  example 
for  encouraging  the  wear  of  our  own  manufactures,  and  discour- 
aging those  drains  to  the  nation  by  foreign  lace,  silks,  &c. ;  and  it 
is  to  be  hoped   her  example  will  be  imitated  by  our  nobility  and 
gentry.      Then  we  shall  soon  see  the  balance  of  trade  turn  in  our 
fevor,  and  gold  and  silver  brought  into  the  nation  to  be  coined." 
"  What  a  boundless  wealth,"  says  Gee,  "  might  be  brought  into 
this  kingdom  by  supplying  our  plantations  with  everything  they 
want,  and  all  manufactured  within  ourselves  !"     He  thought  "  a 
small  squadron  of  light  frigates,"  and  "  placing  standing  forces  in 
the  colonies,   to  keep  them   in  order,  and  obliging  them  to  raise 
money    to  pay    them,"    would    suppress    any    disposition    in  the 
colonists    "  to    set    up  for   themselves."      He    says :    "  It    would 
be  sad  policy  for  governments  to  spare  their  people,  be  at  the 
charge  of  protecting  them  abroad,  and  yet  allow  them  to  set  up  the 
manufactures  of  their  mother-kingdoms,  whereby  they  would  sup- 
ply themselves,  and  in  respect  to  trade  and  commerce,  throw  them 
into  a  state  of  independency."     He   proposed  that  "  all  slitting 
mills,"  in  the  colonies,  "  and  engines  for  drawing  wire  and  weav- 
ing stockings,  be  put  down  ;  and  that  every  smith  who  keeps  a 
common  forge  or  shop,  shall  register  his  name  and  place  of  abode, 
and  the  name  of  every  servant  which  he  shall  employ ;    which 
license  shall  be  renewed  every  year,  and  pay  for  the  liberty  of 
working  at  such  trade  ;  that  all  negroes  shall  be  prohibited  from 
weaving  either  linen  or  woollen,  or  spinning  or  combing  wool,  or 
working  at  any  manufacture  of  iron,  further  than  making  it  into 
pig  or  bar  iron  ;  that  they  shall  be  also  prohibited  from  manufac- 
turing hats,  stockings,  or  leather  of  any  kind."     Private  families 
might  spin  and  weave  for  their  own  use,  but  not  for  market.     De- 
tailed reports  from  the  governors  of  colonies  to  the  lords  of  trade, 
of  all  going  on  in  the  way  of  manufactures,  were  required,  "  that 
they  might  be  encouraged  or  depressed,  according  to  their  wants, 
or  the  danger  of  dieir  too  much  interfering  with  us.     Indeed," 


336  BALANCE    OF    TRADE. 

says  Gee, "  if  they  shall  set  up  manufactures,  and  the  government  shall 
afterward  be  under  a  necessity  of  stopping  their  progress,  we  must 
not  expect  that  it  will  be  done  with  the  same  ease  that  now  it  may." 
On  the  subject  of  depending  on  foreigners  for  things  that  could 
be  produced  at  home.  Gee  says :  "  It  is  astonishing  that  so  wise  a 
nation  as  this  does  not  take  care  to  regulate  these  matters.  All 
other  nations  of  Europe,"  he  says,  "  are  wise  enough  to  do  it."  — 
"  For  the  sake  of  saving  a  penny,  we  often  debar  ourselves  of 
things  of  a  thousand  times  the  value.  This  misfortune  will  hap- 
pen to  any  trading  nation,  if  the  persons  who  have  the  regulation 
of  the  commerce  do  not  understand  it  well  enough  to  distinguish 
nicely  between  those  channels  by  which  the  riches  flow  in  upon 
them,  and  those  that  carry  them  away. 

"If  we  examine  into  all  the  circumstances  of  the  inhabitants  of 
our  plantations,  and  our  own,  it  will  appear  that  not  one  fourth  part 
of  their  product  redounds  to  their  own  profit.     For,  out  of  all  that 
comes  here,  they  only  carry  back  clothing  and  other  accommoda- 
tions for  their  families,  all  which  is  of  the  manufacture  and  mer- 
chandise of  this  kingdom.     If  anything  to  spare,  it  is  laid  up  here, 
and  their  children  are  sent  home  to  be  educated  ;    if  enough  to 
purchase  an  estate,  then  it  is  laid  out  in  Old  England.     All  these 
advantages  we  receive  from  the  plantations,  besides  the  mortgages 
on  the  planters'  estates,  and  the  high  interest  they  pay  us,  which  is 
very    considerable ;    and"  therefore   very  great  care    ought    to  be 
taken  in  regulating  all  affairs  of  the  colonies,  that  the  planters  be  not 
put  under  too  many  difficulties,  but  encouraged  to  go  on  cheerfully. 
"  New  England  and  the  northern  colonies  have  not  commodities 
and  products  enough  to  send  us  in  return  for  their  necessary  clothing, 
&c.,  but  are  under  very'great  difficulties;  and  therefore  any  ordi- 
nary sort  sells  with  them.     And  ivheri  they  are  grown  out  of  fashion 
with  us,  THEY  ARE  NEW-FASHIONED  ENOUGH  THERE.     There- 
fore, those  places  are  the  great  markets  we  have  to  dispose  of  such 
goods.   .  .  The  continual  motion  and  intercourse  our  people  have 
with  the  colonies,  may  be  compared  to  bees  of  a  hive,  which  go  out 
empty,  but  come  back  again  loaded."  —  "Laws,"  said  Gee,  "  are 
made,  in  the  colonies,  which  they  exercise  till  sent  home  and  dis- 
approved of.     It  is  therefore  proposed,  that  no  law  shall  pass  in  the 
plantations,  until  a  copy  thereof  be  prepared  by  the  governor  and 
assembly  of  each   province,  and  sent  here  to  be  examined  or  ap- 
proved by  the  king  and  council,  as  the  laws  from  Ireland  now  are," 
save  special  laws  for  defence  against  the  Indians.  —  "We  ought 


BALANCE    OF    TRADE.  337 

always  to  keep  a  watchful  eye  over  our  colonies,  to  restrain  them 
from  setting  up  any  of  the  manufactures  which  are  carried  on  in 
Great  Britain,  whereby  they  would  do  us  much  hurt,  and  them- 
selves no  good,  because  their  labor  might  be  more  profitably  em- 
ployed in  raising  the  products  of  the  country  ;  and  any  such 
attempts  should  be  crushed  in  the  beginning;  for  if  they  are  suf- 
fered to  grow  up  to  maturity,  it  will  become  difficult  to  suppress 
them,  and  seem  a  greater  hardship  to  the  people."  This,  certain- 
ly, is  in  excellent  keeping  with  the  annual  report  of  the  United 
Stales  secretary  of  the  treasury,  for  December,  1S4-5. 

"  To  think  it  would  be  an  advantage  for  any  trading  nation  to 
admit  all  manner  of  foreign  commodities  to  be  imported  free  from 
all  duties,  is  an  unaccountable  notion,  and  still  much  less  suitable 
to  the  circumstances  of  our  island  than  to  the  continent.  .  .  It  will 
be  a  maxim  strictly  to  be  observed  by  all  prudent  governments, 
which  are  capable  of  manuf^ictures  within  themselves,  to  lay  such 
duties  on  the  foreign  as  may  favor  iheir  own,  and  discourage  the 
importation  of  any  of  the  like  sorts  from  abroad.  By  this  means 
the  French  have,  in  our  time,  nursed  up  a  woollen  manufactory, 
and  brought  it  to  such  perfection,  as  to  furnish  themselves  with  all 
such  woollen  goods  as  they  formerly  bought  of  us  to  a  very  great 
value,  and  are  even  become  competitors  with  us  in  foreign  mar- 
kets."— "  We  send  our  money  to  foreign  nations,  and  by  employ- 
ing their  poor,  instead  of  our  own,  enable  them  to  thrust  us  out  of 
our  foreign  trade,  and  by  their  imposing  high  duties  upon  our  man- 
ufactures, so  clog  the  exportation  of  them,  that  it  amounts  to  a  pro- 
hibition."—  "  'J'he  trade  of  a  nation  is  of  mighty  consequence,  and 
a  thing  that  ought  to  be  seriously  weighed,  because  the  happiness 
of  so  many  millions  depends  upon  it.  A  little  mistake  in  the  be- 
ginning of  ati  undertaking  may  swell  to  a  very  great  one.  A  nation 
may  gain  vast  riches  by  trade  and  commerce  ;  or  for  want  of  due 
regard  and  attention,  may  be  drained  of  them.  I  am  the  more  wil- 
ling to  mention  this,  because  I  am  afraid  the  present  circumstance 
of  ours  carries  out  more  riches  than  it  brinjjs  home.  As  there  is 
cause  to  apprehend  this,  surely  it  ought  to  be  looked  into ;  and 
the  more,  since,  if  there  be  a  wound,  these  are  remedies  proposed, 
which,  if  rightly  applied,  will  make  our  commerce  flourish,  and  the 
nation  happy." 

Such  was  the  reasoning  of  Joshua  Gee,  which  was  adopted  as 
the  national  policy  of  Great  Britain  at  the  time,  and  which  has  pre- 
vailed there  down   to  the  present  period,  without  remission,  and 

22 


33S  BALANCE    OF    TRADE. 

without  any  present  prospect  of  being  relaxed.  It  was  by  this  pol- 
icy, that  she  has  become  the  richest,  the  greatest,  and  most  power- 
ful nation  in  the  world. 

M.  Say's  reasoning  on  the  balance  of  trade  is  curious  enough. 
He  says :  "  Money,  like  other  things,  is  itself  a  commodity.  A 
French  merchant  consigns  to  England  brandies,  to  the  amount  of 
20,000  francs;  liis  commodity  was  equivalent  in  France  to  that 
sum  in  specie;  if  it  sell  in  England  for  ^1000  sterling,  and  that 
sum  remitted  in  gold  or  silver  be  worth  24,000  francs,  there  is  a  gain 
of  4,000  francs  only,  although  France  has  received  24,000  francs 
in  specie.  But,  should  the  merchant  lay  out  his  <£1,000  in  cotton 
goods,  and  be  able  to  sell  them  in  France  for  28,000  francs,  there 
would  then  be  a  gain  to  the  importer  and  to  the  nation  of  8,000  francs, 
although  no  specie  whatever  had  been  brought  into  the  country.  In 
short,  the  gain  is  precisely  the  excess  of  the  value  received  above  the 
value  given  for  it,  whatever  be  the  form  in  which  die  import  is  made." 

Brandy  is  a  product  of  France,  and  she  is  supposed  to  have  a 
surplus  for  the  foreign  market.  Clearly,  then,  by  the  first  hypoth- 
esis, France  received  an  addition  to  her  "numeraire"  of  24,000 
francs,  and  was  a  gainer  to  that  amount.  If  her  "tools"  of  trade 
were  short,  it  was  an  impoi'tant  gain,  so  far  as  it  might  go  to  sup- 
ply that  defect.  She  gained  the  whole  any  how.  In  the  second 
hypothesis,  as  between  France  and  England,  it  was  a  mere  case 
of  barter  of  one  thing  for  another;  and  if  France  wanted  the  cotton 
goods,  and  did  not  want  the  brandy,  it  was  a  profitable  exchange 
—  that  is  all.  It  can  not  be  said  that  France  gained  8,000  francs, 
as  M.  Say  avers ;  for  the  profit  of  the  merchant  was  between  him 
and  the  consumers  of  his  goods.  He  bought  the  brandy  of  French 
producers,  and  sold  the  returns  to  French  consumers,  who  paid  him 
8,000  francs  for  his  services.  So  far  as  these  transactions  were 
concerned,  these  8,000  francs  profit  to  the  merchant,  only  passed 
from  one  hand  to  another  in  France.  France  itself,  as  a  trading 
party  with  England,  gained  nothing  but,  as  is  possible,  a  profitable 
barter  —  things  wanted  for  things  not  wanted.  When  Peter  pays 
over  to  Paul,  both  being  Frenchmen,  8,000  francs,  by  what  ride 
can  it  be  shown  that  France  is,  therefore,  8,000  francs  richer? 
The  principle  involved,  and  evidently  intended  to  be  asserted  by 
M.  Say,  in  these  two  hypotheses,  is  entirely  fallacious,  and  in  its 
practical  operation  as  a  doctrine  of  public  economy,  might  be  ruin- 
ously disastrous.  As  for  instance,  when  a  nation,  by  overtrading, 
has  already  parted  with  half,  or  three  fourths  of  its  "  tools"  of  trade, 


BALANCE    OF    TRADE.  339 

or  of  the  cash  which  is  necessary  for  its  ordinary  business,  this  doc- 
trine avers,  that  that  nation  is  not  only  a  gainer  by  the  barter  of  one 
thing  for  another,  if  the  merchants  who  make  tiiese  exchanges  profit 
in  the  distribution  of  the  returns,  and  a  gainer  to  the  exact  amount 
of  the  profit  of  the  merchants  ;  but  that  it  is  a  gainer  also  by  trading 
away  the  remainder  of  its  cash,  provided  the  merchants  reahze  a 
profit,  and  a  gainer  to  the  amount  of  that  profit.  For  he  says: 
♦'  Tiie  gain  [to  the  nation]  is  precisely  the  excess  of  the  value  re- 
ceived, above  the  value  given  for  it,  whatever  be  the  form  in  which 
the  import  is  made." 

This  brings  us  precisely  to  the  cases  of  excessive  importations, 
as  noticed  in  our  commercial  history  in  chapter  xxiv.,  which  have 
always  proved  so  disastrous  and  ruinous  to  this  country.  That 
this  is  M.  Say's  meaning,  is  evident  enough  from  what  he  says,  in 
the  same  connexion,  viz. :  "  In  a  thriving  country,  the  value  of  the 
total  imports,  should  always  exceed  that  of  tlie  exports."  It  is  easy 
enough  to  see,  that  no  country  would  thrive  very  long  in  this  way, 
as  its  cash  must  sooner  or  later  be  exhausted.  But,  on  his  own 
theory,  that  money  is  only  a  commodity,  there  could  not  be  an  ex- 
cess of  imports,  in  an  honest  commerce,  when  all  balances  are 
settled.  Does  he  mean  to  sanction  repudiation  —  fraud  ?  The 
whole  of  this  reasoning  is  characterized  by  a  theoretical  audacity 
which  one  might  well  wonder  at,  and  demands  a  faith  that  must  be 
entirely  blind,  if  given. 

It  is  not  denied  that  the  earnings  of  American  ships  and  crews, 
and  the  profits  of  American  merchants,  mii;ht  justify  some  excess 
of  imports,  if  there  were  money  enough  already  in  the  country  for 
its  trade.  But  we  do  not  understand  tliis  to  be  the  ground  of  M. 
Say's  averment.  He  expressly  says,  that  a  nation  should  encourage 
the  export  of  specie,  as  a  profitable  commerce,  without  any  regard 
to  its  being  necessary,  or  not,  as  "  tools"  of  trade  at  home. 

What  is  necessary  to  a  private  commercial  dealer,  is  necessary 
to  a  commercial  nation,  viz.,  always  to  have  money  enough  at  com- 
mand, to  carry  on  the  business  of  the  party  concerned,  and  to  meet 
all  engagements,  without  embarrassment.  To  dispose  of  other  com- 
modities, not  wanted  at  home,  as  fast  as  ready  for  market,  at  a  fair 
price,  may  well  be  regarded  as  good  economy.  And  to  use  money 
in  trade,  so  long  as  enough  is  on  hand  for  all  demands,  may  also 
be  good  economy.  But  to  part  with  money  merely  for  the  sake 
of  buying  more  than  one  sells,  without  regard  to  the  consideration 
whether  it  can  be  spared,  is  a  most  extraordinary  method  of  thrift. 


340  BALANCE    OF    TRADE. 

All  prudent  men  think  it  best  to  sell  at  least  as  much  as  they  buy ; 
and  if  they  have  money  enough  for  all  demands,  they  may  thrive 
by  it.  But  when  their  purchases  habitually  exceed  their  sales, 
there  is  no  recognised  mode  of  settling  balances  except  by  cash. 
If  cash  had  been  hoarded,  it  might  be  safe  and  advisable  to  go  on 
in  this  way,  till  the  excess  of  usual  and  known  demands  should  be 
exhausted.  The  values  received,  and  put  to  use,  might  be  profitable, 
when  the  hoarded  money  would  not  be  so.  But  farther  than  that, 
could  not  be  regarded  as  within  the  bounds  of  commercial  prudence. 

As  a  man,  by  cultivating  his  estate,  and  taking  care  not  to  buy 
more  than  he  sells,  may  thrive,  so  the  home  trade  of  a  nation,  when 
there  is  no  excess  of  imports  over  exports,  is  the  way  to  a  nation's 
wealth  ;  and  as  a  man  who  habitually  rims  in  debt,  must  ultimately 
fail,  so  must  a  nation  fail,  that  habitually  imports  more  than  it  ex- 
ports. The  wealth  of  individuals  and  of  nations  is  usually  created 
at  home.  It  never  comes  from  abroad,  except  by  a  practice  di- 
rectly the  reverse  of  M.  Say's  hypotheses.  In  that  way,  it  may 
come  ;  and  in  that  way  Great  Britain  has  acquired  immense  wealth. 

But  Adam  Smith  was  the  author  of  the  mode  of  reasoning  above 
ascribed  to  M.  Say  ;  and  it  was  originally  presented  by  him  in  the 
following  form  :  "  If  the  tobacco  which,  in  England,  is  worth  only 
a  hundred  thousand  pounds,  when  sent  to  France,  will  purchase 
wine  which  is,  in  England,  worth  a  hundred  and  ten  thousand 
pounds,  the  exchange  will  augment  the  capital  of  England  by  ten 
thousand  pounds.  If  a  hundred  thousand  pounds  of  English  gold, 
in  the  same  manner,  will  purchase  French  wine,  whicl^n  Eng- 
land, is  worth  a  hundred  and  ten  thousand,  this  exchange  will 
equally  augment  the  capital  of  England  by  ten  thousand  pounds. 
As  a  merchant  who  has  a  hundred  and  ten  thousand  pounds  worth 
of  wine  in  his  cellar,  is  a  richer  man  than  he  who  has  only  a  hundred 
thousand  pounds  worth  of  tobacco  in  his  warehouse,  so  is  he  like- 
wise a  richer  man  than  he  who  has  only  a  hundred  thousand  pounds 
worth  of  gold  in  his  coffers.  He  can  put  into  motion  a  greater 
quantity  of  industry,  and  give  revenue,  maintenance,  and  employ- 
ment, to  a  greater  number  of  people  than  either  of  the  other  two. 
But  the  capital  of  the  country,  is  equal  to  the  capitals  of  all  its 
different  inhabitants,  and  the  quantity  of  industry  which  can  be 
annually  maintained  in  it,  is  equal  to  what  all  these  different  capi- 
tals can  maintain.  Both  the  capital  of  the  country,  therefore,  and 
the  quantity  of  industry  which  can  be  maintained  in  it,  must  gen- 
erally be  augmented  by  this  exchange." 

Adam  Smith,  as  will  be  seen,  has  raised  two  questions  here,  one 


BALANCE    OF    TRADE.  841 

of  private  and  the  other  of  public  economy,  and  has  confounded 
the  two,  to  help  himself  to  an  absurd  conclusion.  In  the  matter 
of  private  economy,  he  is  right,  and  right  in  his  conclusions,  so  far 
as  they  fall  within  that  range  ;  but  in  that  of  public  economy,  he 
is  wrong,  because  he  is  absurd.  As  we  admit  the  correctness  of 
his  conclusions,  so  far  as  they  relate  to  private  economy,  it  is  un- 
necessary to  consider  them.  So  far  as  public  economy  is  con- 
cerned, the  tobacco  and  the  wine  are  equivalents.  The  nation  is 
neither  richer  nor  poorer,  for  the  exchange,  though  the  merchant 
has  gained  ten  thousand  pounds.  Adam  Smith's  statement,  that 
there  is  ten  thousand  pounds  more  ability  to  put  industry  in  motion, 
is  true  as  applied  to  the  merchant,  and  false  as  applied  to  the  na- 
tion, so  far  as  his  premises  go.  The  gain  of  the  merchant  has  only 
changed  hands  in  England,  so  far  as  we  are  informed.  It  might 
Slave  done  more  for  industry  in  other  hands,  or  it  may  do  more  in 
his;  but  on  that  point  nothing  need  be  said,  as  nothing  can  be 
proved.  Adam  Smith's  reasoning,  therefore,  falls  to  the  ground, 
as  beginning  with  the  exchange  of  the  tobacco  for  the  wine.  But 
in  the  exchanse  of  the  gold  for  the  wine,  he  has  made  a  sad  blun- 
der.  As  he  calls  this  "a  trade  of  consumption,"  in  this  very  con- 
cexion,  we  conclude  his  hypothesis  leaves  this  wine,  bought  in 
France  with  gold,  to  be  consumed  in  England.  If  so,  though  the 
merchant  is  richer  by  ten  thousand  pounds,  nothing  is  more  clear, 
than  that  the  nation  is  minus  a  hundred  thousand.  If  the  wine 
bad  been  re-exported,  the  nation  might  have  been  a  gainer.  But 
this  does  not  appear  to  be  a  part  of  die  hypothesis.  The  wine  is 
drunk  at  home,  and  the  gold  is  in  France.  Here  is  seen  the  dif- 
ference between  private  and  public  economy,  when  private  and 
public  interests  are  both  involved  in  the  same  foreign  commercial 
transactions.  Not  that  there  is  any  difference  in  principle  between 
private  and  public  economy,  nor  that  there  can  be  two  kinds  of 
economy,  of  which  more  elsewhere  ;  but  a  man  may  be  enriched 
by  the  same  act  that  subtracts  from  the  wealth  of  a  nation. 

The  ground  o(  Uiis  fallacy  of  M.  Say,  Adam  Smith,  and  others 
of  that  school,  lies  in  the  assumption,  that  there  is  no  economical 
difference  between  money  and  the  commodities  for  which  it  is  ex- 
changed—  a  question  tliat  has  already  been  considered  in  chapter 
xiv.  It  is  remarkable,  how  devotion  to  a  theory  will  blind  the  eyes 
to  absurdity.  This,  as  will  be  found,  is  one  of  the  most  vital  errors 
that  could  possibly  be  committed  in  a  system  of  public  economy. 
It  is,  perhaps,  true  to  say,  that  it  is  tlie  fundamental  error  of  the 
advocates  of  Free  Trade,  and  the  source  of  all  the  rest. 


342  THE    MUTUAL    DEPENDENCE    OF 


CHAPTER   XXII. 

THE    MUTUAL   DEPENDENCE   OF  AGRICULTURE,  MANUFACTURES, 

AND    COMMERCE. 

These  three  are  a  natural  Family  of  Interests  in  the  United  States — Agricuhure  alone 
subjects  a  Nation  to  Depenileiice — Adam  Smith  on  this  Point. — Adam  Smith  and  liis 
School  have  furnished  the  bust  Refiitation  of  tlieir  own  Errors. — An  Argument  on  the 
indissoluble  Connexion  'uL'tween  these  three  great  Interests. — The  "Mercantile  and 
Agricultural  Sy.stem.","  as  defined  by  Adam  Smith  and  other.»,  considered — There  is  no 
Fouiidiition  for  this  Array  of  these  two  Systems,  as  opposed  to  each  other,  and  made  so 
much  of  by  some  of  the  Economists — The  Importing  Merchants  favor  Free  Trade. — 
Smith's  and  Gee's  Description  of  this  Class  of  Traders. — The  Independent  Position  of 
every  Commercial  Transaction. 

It  is  remarkable,  that  these  three  comprehensive  words,  agri- 
culture, manufactures,  and  commerce,  have,  from  the  beginning 
of  our  history,  been  employed  to  represent  the  three  cardinal  in- 
terests of  the  country.  They  are  equally  natural,  proper,  and  true 
—  natural  as  suggested  by  experience  and  observation  ;  proper  as 
expressing  the  things  intended  ;  and  true  as  expressing  them  in 
their  natural  order  and  relative  importance.  Each  of  them,  in  a 
great  country  —  more  especially  in  one  that  aspires  to  indepen- 
dence—  is  indispensable  to  each.  Tliey  are  a  natural  family  of 
interests,  that  can  not  be  divorced,  without  fatal  injury  to  the  com- 
mon good  ;  and  since  each  is  indispensable  to  the  wealth,  great- 
ness, power,  and  independence  of  a  nation,  it  is  not  easy  to  say 
which  could  be  wanting  with  the  least  impediment  to  these  objects. 
Agriculture  is  doubtless  most  necessary  to  the  subsistence  of  a 
people,  in  the  more  primitive  condition  of  the  race;  but  there  can 
be  but  little  of  private  or  public  wealth,  but  little  of  civilization, 
nothing  of  independence  as  a  political  commonwealth,  and  there 
must  be  almost  or  quite  a  total  want  of  political  power  among  na- 
tions, with  that  member  of  the  great  family  whose  sole  pursuit  is 
agriculture  merely.  To  furnish  food  for  others  to  live  on,  and  raw 
materials  for  others  to  work  over  and  grow  rich  by,  in  the  applica- 
tion of  their  ingenuity,  skill,  and  art,  is  a  condition  of  dependence 
and  subserviency,  both  of  individu:d  persons  and  of  nations.  Adam 
Smith  has  stated  this  point  with  great  force,  as  follows :  "  A  small 
quantity  of  manufactured  produce  purchases  a  great  quantity  of 
rude  produce.     A  trading  and   manufacturing  country,  thereiore, 


AGRICULTURE,    MANUFACTURES,    AND    COMxMERCE.         343 

with  a  small  part  of  its  manufactured  produce,  will  purchase  a 
great  part  of  the  rude  produce  of  other  countries;  while,  on  the 
contrary,  a  country,  without  trade  and  manufactures,  is  generally 
ohliged  to  purchase,  at  the  expense  of  a  great  part  of  its  rude 
produce,  a  very  small  part  of  the  manufactured  produce  of  other 
countries.  The  one  exports  what  can  subsist  and  accommodate 
but  a  very  few,  and  imports  the  subsistence  and  accommodation  of 
a  great  number.  'I'he  other  exports  the  accommodation  and  sub- 
sistence of  a  great  number,  and  imports  tliat  of  a  very  few  only. 
The  inhabitants  of  the  one  must  always  enjoy  a  much  greater 
quantity  of  subsistence  ihan  what  their  own  lands,  in  the  actual 
state  of  their  cultivation,  could  afford  ;  and  the  inhabitants  of  the 
other  must  always  enjoy  a  much  smaller  quantity." 

This,  as  can  not  be  denied,  is  very  remarkable  language,  for  one 
who  is  set  up  as  authority  in  the  United  States,  to  make  us  con- 
tented with  being  mere  raw  producers  for  Europe,  and  Great 
Britain  in  particular.  The  case,  certainly,  is  here  very  fairly  stated 
by  Adam  Sujith  :  "  The  one  [the  raw-producing  country]  exports 
what  can  subsist  and  accommodate  but  a  very  few  [of  its  own  pop- 
ulation], and  imports  the  subsistence  and  accommodation  of  a 
greater  number  [in  ihe  manufacturing  country].  The  other  [the 
manufacturing  country]  ex|iorts  the  subsistence  and  accommoda- 
tion of  a  greater  nimiber  [of  its  own  population],  and  imports  that 
of  a  very  few  only  [of  the  population  of  the  raw-producing  coun- 
try]. The  inhabitants  of  the  one  [the  manufacturing  country]  must 
always  enjoy  a  much  greater  quantity  of  subsistence,"  &c.  Again, 
the  same  principle  is  developed  by  Adam  Smith  in  the  following 
sentence  :  "  In  every  country  of  Europe  we  find,  at  least,  a  hun- 
dred people  who  have  acquired  great  fortunes  from  small  begin- 
nings, by  trade  and  manufactures  —  the  industry  which  properly 
belongs  to  towns  —  for  one  who  has  done  so  by  that  which  prop- 
erly belongs  to  tlie  country,  viz.,  the  raising  of  rude  produce,  by 
the  improvement  and  cultivation  of  land." 

The  condition  of  the  /(/w-producing  country,  as  above  described 
by  Adam  Smith,  is  precisely  that  into  which  it  was  projiosed  by 
the  secretary  of  the  treasury,  in  his  annual  report  of  December, 
1845,  to  put  the  United  States  ;  that  is,  to  raise  rude  produce  for 
manufacturing  nations,  such  as  England.  He  says  :  "  Agriculture 
is  our  ciiief  employment.  It  is  best  adapted  to  our  situation." 
England,  and  other  foreign  workshops,  would,  in  such  a  case, 
make  all  the  fortunes,  by  the  sweat  of  American  brows.     Admit 


344  THE    MUTUAL    DEPENDEINCE    OF 

that  these  fortunes  would  otherwise  be  made  by  American  manu- 
facturing towns,  under  a  protective  system,  the  capital  would  then 
remain  at  home,  and  be  employed  here.  It  would  flow  back  from 
the  towns  to  the  country,  and  enrich  the  whole  community.  Is 
any  one  so  simple  as  to  imagine,  that  it  is  equally  well,  and  even 
better,  for  the  country,  that  its  money  should  go  abroad  to  enrich 
foreigners,  than  to  stay  at  home,  and  enrich  Americans,  who  would 
employ  it  all  at  home  ?  —  But  Adam  Smith  discloses  yet  another 
pertinent  and  forcible  principle,  applicable  here,  in  the  following 
words  :  "  The  commerce  and  manufactures  of  cities,  instead  of 
beins:  the  effect,  have  been  the  cause  and  occasion  of  the  cultiva- 
tion  of  the  country."  Thus  he  recognises,  very  justly,  the  indis- 
soluble connexion  between  agriculture,  manufactures,  and  com- 
merce, and  at  the  same  time  pioves  that  the  manufacturing  and 
commerce  must  be  done  by  the  nation  that  produces  the  raw  ma- 
terial, else  its  wealth  will  be  drawn  away,  and  the  manufacturing 
nation  or  nations  will  grow  rich  at  its  expense.  Jt  is  well  to  be 
able  to  establish  so  clear  a  proposition,  by  the  authority  whicli  is 
cited  to  overthrow  it.  Fortunately  it  happens,  as  we  often  have 
occasion  to  remark,  that  every  one  of  the  European  economists, 
from  vvhom  the  doctrine  of  Free  Trade  has  been  borrowed  by  iheir 
American  disciples,  who  seem  to  be  incapable  of  discrimination, 
has  unavoidably  laid  down,  here  and  there,  isolated  propositions, 
which  not  only  establish  a  protective  policy  on  the  strongest  pos- 
sible foundation,  but  which  utterly  subvert  all  the  reasoning,  found 
in  the  same  authorities,  favoring  Free  Trade.  They  have  them- 
selves furnished  the  best  refutation  of  their  own  errors. 

Dr.  List,  a  German  economist,  and  an  advocate  of  Protection, 
says  :  "  The  production  of  raw  material  and  food,  is  of  high  im- 
portance among  the  nations  of  the  temperate  zone,  only  with  regard 
to  their  internal  commerce.  By  the  export  of  grain,  wine,  flax, 
hemp,  wool,  and  such  like,  a  rude  or  poor  nation,  in  the  infancy 
of  its  civilization,  may  signally  raise  its  agriculture  ;  but  a  great 
nation  has  never  thereby  arrived  at  wealth,  civilization,  and  power. 
One  may  lay  it  down  as  a  rule,  that  a  nation  is  so  much  the  more 
wealthy  and  powerful,  the  more  it  exports  manufactured  products, 
the  more  it  imports  raw  materials,  and  the  more  it  consumes  the 
products  of  the  torrid  zone." 

We  proceed  to  state,  that,  in  proportion  as  home  manufactures 
are  multiplied  and  extended  by  a  protective  system,  so,  not  in  tho 
same  proportion,  but  in  afar  greater  proportion,  are  the  agriculture 


AGRICULTURE,    MANUFACTURES,    AND    COMMERCE.         345 

and  commerce  of  the  coiiinry  benefited.  It  is  shown,  elsewhere, 
how  domestic  manufactures  absorb  tlie  products  of  agriculture,  and 
how  a  home  market  for  agricultural  produce  is  better  than  a  foreign 
market.  In  the  first  place,  the  domestic  art  absorbs  of  the  prod- 
ucts of  agriculture,  all  that  is  necessary  for  the  subsistence  of  the 
artisans,  which  would  otherwise  be  supplied  by  the  artisans  them- 
selves. In  the  next  |)lace,  agriculture  furnishes  the  raw  materials  in 
many  cases,  as  in  the  inanufacture  of  woollens,  and  in  the  making 
and  manufactures  of  iron.  This  is  all  saved  to  the  American  airri- 
culturist,  by  home  manufacture,  and  the  benefit  is  immense.  In 
the  tliirl  place,  all  the  varieties  of  business  that  are  set  a^oinsf 
at  home,  by  this  increase  of  home  ma nu (Pictures,  take  off  from  the 
number  of  persons  devoted  to  agriculture,  that  is,  their  numbers 
relative  to  other  pursuits,  make  agriculture  more  profitable  for 
the  remainder,  increase  the  demand  for  agricultural  products  in 
a  variety  of  ways,  and  in  that  mode  sustain  and  raise  prices.  Tn 
the  fourth  place,  it  makes  a  great  difference  in  the  profits  of  the 
agriculturist,  when  the  manufacturer  comes  to  liim  at  his  own  door, 
and  when  he  has  to  go  after  the  manufacturer  in  foreign  parts.  In 
the  former  case,  the  agriculturist  is  sure  of  his  cu-tomer  ;  in  the 
latter,  not;  and  in  the  former,  he  is  saved  the  costs  of  transporta- 
tion both  ways,  which  the  latter  would  impose  upon  him.  This 
close  contiguity  of  the  agriculturist  and  manufacturer,  helps  both, 
sustains  both,  and  both  contribute  to  the  wealth  of  the  community, 
which,  in  turn,  contributes  to  their  wealth.  7'he  many  values, 
added  by  manufacture  to  the  raw  materials,  sometimes  six,  some- 
times ten,  running  up  to  hundreds,  and  even  thousands,  which 
would  otherwise  be  created  and  realized  abroad,  are  created  and 
realized  at  home,  and  add  so  much  to  the  stock  of  private  and 
public  wealth. 

Professor  Twiss  well  observes  :  "  It  is  of  the  highest  impor- 
tance to  the  farmer,  that  the  arts  should  prosper,  as  it  is  recipro- 
cally to  the  artisan,  that  agriculture  should  flourish.  A  town  situ- 
ated in  a  rich  country  finds  a  large  body  of  purchasers  among  the 
neighboring  agriculturists,  precisely  as  farmers,  who  dwell  near  a 
flourishing  town,  find  an  excellent  market  for  their  produce  among 
the  artisans.  .  .  If  the  agriculture  of  a  country  flourishes,  it  is  a 
reason  why  its  manufactures  and  commerce  should  flourish,  just 
as  the  prosperity  of  its  manufactures  and  commerce  must  exercise 
a  beneficial  influence  upon  its  agriculture."  This,  it  must  be  al- 
lowed,  is   most   excellent  reasoning,  except,  perhaps,  it  does  not 


346        THE    MERCANTILE    AND    AGRICULTURAL    SYSTEMS. 

State  with  sufficient  clearness  and  force  ihe  reciprocal  dependence 
of  agriculture  and  the  arts.  Instead  of  saying,  "  If  the  agriculture 
of  a  country  flourishes,"  &c.,  he  should  have  said,  it  flourishes  be- 
causp  the  arts  do,  and  the  prosperity  of  the  arts  is  identified  with 
that  of  agriculture.  Each  is  cause  of  the  good  condition  of  the 
other.  Commerce,  including  home  and  foreign  trade,  is  the  great 
pul)lic  agent,  which  agriculture  and  manufactures  employ  to  dis- 
trihute  their  products  at  home  and  ahroad  ;  and  it  has  elsewhere 
been  shown  in  this  work,  demonstrated,  we  rrlay  say,  by  authen- 
tic statistical  evidence,  that  commerce  —  home  and  foreign  trade 
—  always  flourishes  most  under  a  protective  system.  Consequently 
it  is  proved,  by  this  result  in  the  matter  of  commerce,  as  well  as 
by  other  modes  of  reasoning,  that  agriculture  and  manufactures 
prosper  most  under  such  a  system.  Else,  how  could  commerce 
have  more  to  do,  as  the  agent  of  these  two  great  interests  ? 

There  has  not,  therefore,  been  a  mistake,  as  the  doctrines  of 
Free  Trade  suppose,  in  the  importance  which,  from  the  beginning 
of  our  history  as  a  nation,  has  been  attached  to  these  three  cardi- 
nal interests  of  the  country,  agriculture,  manufactures,  and  com- 
merce; much  less  has  there  been  a  mistake  in  the  importance  felt 
of  protecting  them  equally  and  alike,  and  protecting  them  well,  as 
the  helps  and  handmaids  of  each  other,  and  they  together,  as  the 
instrument  of  the  wealth  and  power  of  the  whole  peoj)le. 

The  respect  which  has  been  so  long  rendered  to  Adam  Smith,  in 
other  words,  his  authority,  seems  never  to  have  admitted  of  a  ques- 
tion, that  there  must  be  something  in  that  which  he  has  made  so 
much  of,  viz.,  the  assumed  antagonistical  positions  of  commerce  and 
agriculture  ;  and  accordingly  almost  every  writer  on  public  econo- 
my, since  Adam  Smith,  has  taken  up  the  debate  about  "  the  mercan- 
tile and  agricultural  systems."  In  the  "  mercantile"  is  included  the 
manufacturing  system.  The  vice  of  the  first  of  these,  according 
to  Adam  Smith,  is  its  hostility  to  freedom  of  commerce,  alias,  to 
Free  Trade ;  and  that  of  the  second,  hostility  to  all  foreign  trade. 
Adam  Smith,  perhaps,  has  done  some  good  service,  in  neutralizing 
extreme  opinions  on  either  side,  by  the  interposition  and  elucida- 
tion of  some  abstract  propositions,  not  less  excellent  than  true,  as 
cited  above  ;  though  the  main  object  of  his  extended  discussion 
of  "  the  mercantile  systein,"  as  he  calls  it,  seems  to  have  been  to 
advocate  Free  Trade,  by  setting  up  a  man  of  straw,  and  then 
knocking  him  into  pieces.  There  is  really  and  naturally  no  hos- 
tility, nor  by  any  possibility  can  there  be  hostility,  between  agricul- 


THE    MERCANTILE    AND    AGRICULTURAL    SYSTEMS.         347 

ture  and  trade  —  trade  being  supposed  to  include  manufactures,  as 
in  this  case  it  does.  If  agriculture  be  supposed  to  comprehend  all 
those  pursuits  which  avail  themselves  of  nature  as  a  fundamental 
agent  in  the  production  of  commodities  required  for  the  sustenance 
and  convenience  of  the  human  family,  manufactures  and  commerce 
may  properly  be  denominated,  as  in  fact  they  are,  its  agents  or 
servants,  to  modify  and  distribute  its  products  —  modification,  when 
required,  being  the  function  of  manufactures,  and  distribution  that 
of  trade.  They  can  not  possibly  be  anything  more ;  and  that  is 
precisely  the  position  which  they  occupy. 

In  this  relation,  it  can  not  but  be  seen  that  the  hypothesis  of  any 
natural  or  artificial  hostility  between  the  agricultural  and  mercan- 
tile   interests  —  the    mercantile  includinn;    the    manufacturin": — is 
stamped  whh  absurdity.     It  will  be  admitted  that  there  is  no  vnfu- 
rol  hostility,  and  that  there  are  the  strongest  motives  for  the  con- 
trary state  of  feeling.     How,  then,  can   there  be  an  artijic'uil  or 
fdctitions  hostility?      That,  too,   would   be  a  moral  impossibility. 
They  are  mutually  dependent  on  each  other.     Agriculture  being 
the  basis  of  the  manufacturing  and  commercial  systems,  the  more 
there  is  done  in  the  first,  so  much  more  the  last  two,  as  agents  of 
the  first,  will  have  to  do  ;  and  vice  versa,  the  more  activity  there  is 
in  the  manufacturing  and   commercial  systems,  so   much   greater 
will  be  the  demand  on  the  activity  of  agriculture,   which  is  here 
used  in  so   comprehensive  a  sense  as  to  be  the  chief  producer  of 
the  materials   on    which  these  two   agents  rely  for  employment. 
These  agents  are  the  mere  ministers  of  agriculture  in  everything 
they  do.     Without  them,   agriculture  would   have  nothing  to  do, 
except  to  supply  the  mouths  of  the  wigwam.     The  first  transaction 
of  barter,  in  skins  or  anything  else,  is  the  beginning  of  trade ;  the 
first  apron,  or  the  first  moccasin  (sandal  it  would  be  in  the  east), 
that  is  made,  is  the  beginning  of  manufactures ;  and  the  first  orna- 
ment that  is  attached  to  or  interwoven  in  either,  is  an  improvement 
in  manufactures.     These   operations  at  once   make  a  demand  on 
the  producers  of  the  raw  materials,  and  on  that  sustenance  of  the 
fabricators  which  come  from  the  earth,  the  forests,  and  the  waters; 
and  every  stage  of  progress  in  the  manufacturing  arts,  and  in  that 
commerce  which  they  give  birth  to,  from  these  first  and  simple 
developments   of  human    ingenuity,    up  to  the  production  of  the 
greatest  luxuries,  elegances,  and  refinements  of  the  highest  degrees 
of  civilization,   makes  an   additional    demand   on  the  products  of 
agriculture,  considered,  as  it  is  here,  not  only  as  comprehending 


348        IMPORTING    MERCHANTS    OPPOSED    TO    PROTECTION. 

all  that  the  earth,  but  all  that  nature  yields,  to  the  industry  and 
labor  of  man.  Tliere  is  no  point  of  view,  and  no  possible  practi- 
cal operation  of  things,  in  which  manufactures  and  commerce  do 
not  stand  forth  as  the  ministering  agents  of  this  other  great  and 
comprehensive  interest — and  only  as  ministers,  so  far  as  their  in- 
fluence is  reflective.  It  is  impossible  they  should  not,  in  all  their 
operations,  benefit  agriculture  ;  and  the  greater  and  more  active 
those  operations  are,  so  much  greater  the  benefit. 

We  are  not  unaware  that  certain  artificial  modifications  of  trade, 
in  the  shape  of  privilege,  under  legal  provisions,  may  be  urged  as 
the  ground  of  this  hypothesis  of  Smith  and  others,  and  that  it  may, 
perhaps,  be  said  and  insisted  that  it  is  valid  after  all.  The  point 
here  aimed  at  is  abundantly  answered  in  other  parts  of  this  work. 
Our  only  purpose  here  is  to  show  that  there  was  and  is  no  just 
cause  for  the  much  ado  that  has  been  made  by  economists  about 
the  "mercantile  and  agricultural  systems;"  that  there  is  no  such 
distinction  for  any  practical  purposes;  and  that  all  that  has  been 
said  and  written  about  it,  is  a  waste  of  argument,  making  confusion 
worse  confounded.  The  artificial  modifications  of  trade,  alluded 
to,  do  not  belong  to  this  particular  question,  but  are  embraced  in 
others,  and  are  by  us  considered  in  those  connexions.  We  main- 
tain, that,  for  practical  purposes,  no  theory  of  "  a  mercantile  sys- 
tem," such  as  we  are  now  considering,  can  be  set  up  as  hostile  to 
an  "  agricultural  system  ;"  nor  any  theory  of  the  latter  as  hostile  to 
the  former.  This  huge  invention  —  for  it  is  vastly  huge  —  has 
been  made  thus  vast,  apparently,  to  make  an  impression,  that  there 
was  really  something  in  it;  or,  peradventure,  it  may  be  accounted 
for,  by  the  case  of  a  man  who  has  had  the  misfortune  to  plunge 
into  a  slough,  and  is  seen  floundering  about  a  long  time  before  he 
can  get  out  again. 

Not  only  is  there  no  foundation  for  this  theory  of  a  "  mercantile 
system,"  resting  on  the  basis,  and  having  the  tendency,  alleged  by 
Adam  Smith  and  others,  but  there  is,  perhaps,  some  reason,  es- 
pecially in  the  United  States,  for  alleging  the  existence  of  a  "  mer- 
cantile system,"  having  interests  directly  opposite  to  those  which 
Smith  and  his  followers  have  made  so  prominent,  viz.,  one  opposed 
to  a  protective  system.  It  is,  perhaps,  rather  a  principle,  than  a 
system  —  a  principle  which  governs  every  merchant  in  his  own 
isolated  position,  and  on  account  of  which  a  protective  system  is 
less  favored  among  merchants  engaged  in  foreign  commerce,  than 
among  other  classes,  and  with  the  country  generally.     They  usually 


IMPORTING    MERCHANTS    OPPOSED    TO    PROTECTION.       349 

prefer  freedom  of  commerce,  that  they  may  make  their  fortunes 
the  quickest  and  easiest,  without  any  regard  to  the  good  of  the 
country.  Hence  a  very  prominent  "Journal,"  in  the  city  of 
New  York,  professing  to  be  neutral  in  pohtics,  is  supported  as  an 
advocate  of  Free  Trade,  by  this  interest.  It  may  fairly  be  pre- 
sumed that  this  "  JonrnaV''  did  not  take  this  tack  from  principle,  but 
because  it  had  the  sagacity  to  see  there  was  room  and  would  be 
profit.  Other  journals  of  the  country,  on  the  same  side  of  the 
question,  usually  advocate  Free  Trade  from  motives  of  political 
partisanship  ;  this  for  its  own  advantage,  being  in  the  heart  of  the 
greatest  city  of  the  continent,  connected  with  foreign  commerce. 

Adam  Smith  has  well  described  the  character  of  this  class  of 
merchants,  as  follows :  "  The  merchants  know  perfectly  well  in 
what  manner  foreign  commerce  enriches  themselves.  It  is  their 
business  to  know.  But  to  know  in  what  manner  it  enriches  the 
country,  is  no  part  of  their  business.  This  subject  never  comes 
into  their  consideration."  Again  :  "  The  capital  of  a  wholesale 
merchant  seems  to  have  no  fixed  or  necessary  residence  anywhere, 
but  may  wander  about,  from  place  to  place,  according  as  it  can 
either  buy  cheap  or  sell  dear.  The  capital  of  the  manufacturer 
must,  no  doubt,  reside  where  the  manufacture  is  carried  on."  He 
adds  for  his  own  purposes,  as  pleading  for  Great  Britain,  against 
the  colonies :  "  Whethei-  the  merchant,  whose  capital  exports  the 
surplus  produce  of  any  society,  be  a  native  or  a  foreigner,  is  of 
very  little  consequence."     It  is,  however,  of  great  consequence. 

Joshua  Gee  says:  "Nothing  of  this  kind,"  that  is,  zeal  for  pro- 
tection, "can  be  expfcled  from  the  merchant,  who  only  pursues 
his  own  business,  and  raises  an  estate  by  those  things  which  the 
government  permit  the  subject  to  trade  in.  He  may  get  a  great 
deal  of  riches  by  importing  foreign  manufactures  for  luxury  and 
excess,  when,  at  the  same  time,  the  nation  is  consuming  its  sub- 
stance, and  running  into  poverty."  The  editor  of  the  sixth  edi- 
tion of  Gee's  work,  1755,  also  says:  "It  has  been  observed,  that 
by  the  mutual  opposition  of  those  [merchants]  who  are  engaged 
in  different  interests,  they  rather  puzzle  than  give  light  to  the  ar- 
gument in  debate;  and  I  must  confess  that  I  have  usually  found 
gentlemen  who  are  not  engaged  in  trade  more  ready  to  entertain 
right  notions  of  commerce,  as  it  respects  the  advantage  or  disad- 
vantage of  the  public.  Though  otherwise  knowing  and  well 
skilled  in  their  own  way,  few  merchants  give  themselves  the  trouble 
to  look  further  than  what  concerns  their  own  particular  interest." 


350        IMPORTING    MERCHANTS    OPPOSED    TO    PROTECTION. 

The  point  which  we  desire  to  fix  here,  is  the  position  and  inter- 
est of  merchants  engaged  in  foreign  comnnerce  :  —  their  position  is 
between  home  and  the  parts  with  which  they  trade  ;  and  their  in- 
terest is,  to  make  all  the  money  they  can  out  of  both.  Hence, 
generally,  they  are  opjiosed  to  restrictions,  which  are  liahle  to 
come  in  the  way  of  their  interest.  If  they  were  to  be  personally 
engaged  in  this  business  for  an  age  or  a  century,  their  interest  and 
that  of  the  country  would  be  identical ;  but  as  they  wish  to  make 
their  fortunes  in  a  brief  period,  and  retire,  they  do  not  like  any  law 
which  may  happen,  at  the  present  moment,  to  stand  in  the  way  of 
their  greatest  profits. 

The  principle  laid  down  by  Ricardo,  that  "  every  transaction  in 
commerce  is  an  independent  transaction,"  is  peculiarly  and  forci- 
bly applicable  here.  The  merchant,  as  such,  is  not  a  patriot,  but 
a  sharper.  He  does  not  trade  for  the  good  of  his  coimtry,  but 
for  bis  own  interest;  and  his  object,  in  every  transaction,  is  to  aug- 
ment his  own  fortune.  He  does  not  need  to  be  told  that  it  is  bet- 
ter for  him  personally  to  j)rofit  at  the  expense  of  the  public,  than 
for  the  public  to  profit  at  his  expense  ;  and  he  will  suffer  no  com- 
punctions for  an  injury  done  to  the  country,  which  brings  a  benefit 
to  himself.  His  reasoning  is  that  he  and  all  his  are  but  as  a  drop 
in  the  bucket,  or  as  a  bucket-full  out  of  the  ocean.  But  the  ag- 
gregate of  all  foreign  commercial  transactions,  is  made  up  exactly 
in  this  way:  Every  one  of  them  "is  an  independent  transaction," 
negotiated  for  a  private  and  selfish  end  ;  and  nothing  but  protec- 
tive regulations  of  the  government,  having  regard  to  the  interests 
of  the  public,  can  secure  those  interests.        » 


PROTECTIVE    DUTIES    NOT    TAXES.  351 


CHAPTER    XXIII. 

PROTECTIVE  DUTIES  NOT  TAXES. 

The  Giiin  oF  Assumptions,  without  Proof,  to  one  Party,  and  llie  Lo»s  to  the  other  hy  con- 
ceHiiiff  them. — The  whole  Controversy  turns  on  the  Proposiiion  of  thii  ChHpter — Popu- 

lar  Iiistinots  on  this  Subject. —  Duties  iiol  the  Cause  or  Measure  of  a  Chaufje  in  Pi  ices 

The  VMst  and  romprehen-ive  Spheres  of  Influence  which  hear  on  this  Cluest  on  — How 
they  all  tend  to  prove  that  Proteciive  Diit'es  are  not  Taxes. — The  Cinse-  Aboad  and 
at  Hi.me.  which  produce  the  Effect — A  Protective  System  aderpia'e  for  al  Purposes 
of  Public  Revenue  in  the  United  Stale.*. — Tlie  Commercial  Position  of  the  United  States 
will,  fir  an  indefinite  Period,  require  Protection — An  Arry  of  Facts  to  estMlilish  the 
Proposition  of  this  Chapter,  witli  Comments. —  Keasons  of  the  Facts — The  great  Mi^•fo^- 
tune  of  conceding,  in  the  technical  Use  of  Language,  that  Protective  Duties  are  Taxes. 

In  the  same  manner  a.s  Free-Trade  economists  liave  always  as- 
sumed, that  their  theory  is  a  science,  they  have  also  as^^iimed,  that 
protective  duties  are  tnxes  ;  and  in  the  same  manner  as  the  first  has 
generally  been  conceded  to  them,  so  has  the  latler.  It  may  also 
be  remarked,  that,  in  the  same  manner  as  they  necessarily  fall,  by 
a  discovery  of  the  absence  of  their  foundation-stone  of  science,  so 
also  the  first,  sole,  and  last  objection  that  has  been  or  can  be  made 
to  a  protective  system,  is  undermined  by  a  proof  of  the  fact,  that 
protective  duties  are  not  taxes.  It  is  remarkable,  too,  that  the 
affirmative  of  this  proposition  should  have  been  so  long  conceded, 
without  scrutiny,  in  the  same  manner  as  has  been  the  case  with 
the  claim  set  up  for  the  theory  of  Free  Trade  as  a  science. 

On  this  point,  viz.,  whether  protective  duties  be  taxes,  or  not, 
hinge.-^  the  w  hole  controversy.  Indeed,  there  never  would  have 
been  any,  except  as  it  has  generally  been  supposed,  that  all  duties 
are  taxes,  measured  by  their  amount.  Whether  the  proposition 
at  the  head  of  this  ciiapter,  is  equally  true  in  all  countries,  we  do 
not  pretend  to  say.  It  will  have  been  seen,  by  the  ground  already 
gone  over,  that  a  system  of  public  economy  can  not  be  devised, 
that  is  equally  applicable  to  all  nations,  nor  to  any  two  nations  ; 
that,  from  the  peculiar  social  organization  of  the  United  States, 
they  occupy  a  peculiar  position  on  this  subject,  as  well  as  on 
others,  in  relation  to  other  nations,  but  especially  so  on  this  ;  that 
the  government  of  the  United  States  was  made  for  the  people,  and 
designed  for  their  benefit  ;  whereas,  the  governments  of  most,  if 
not  of  all,  of  the  countries  with  which  we  have  commercial  inter- 


352  PROTECTIVE  DUTIES  NOT  TAXES. 

course,  are  designed  for  the  benefit  of  the  governing  and  superior 
classes  ;  and  that  labor,  in  those  countries,  by  reason  of  such  a 
desi"-n  and  operation  of  government,  is  deprived  of  a  fair  reward, 
depressed,  degraded,  enslaved. 

But  the  proposition,  that  protective  duties  are  not  taxes,  may 
be  equally  true  in  other  countries  as  in  this,  though  not,  per- 
haps, in  an  equal  degree.  The  principle  that  makes  it  true  here, 
will,  iu  like  circumstances,  make  it  true  everywhere,  other  things 
being  equal.  To  the  people  of  the  United  States,  this  proposition 
has  become  one  of  the  greatest,  one  of  momentous  importance ; 
first,  because  it  is  generally  believed  and  taken  for  granted,  that 
all  duties  are  taxes  ;  next,  because  this  false  assumption  is  the  only 
objection  to  protective  duties;  and  lastly,  because,  if  protective 
duties,  in  the  United  States,  are  not  only  not  taxes,  but  a  rescue 
from  taxation,  and,  as  will  be  found,  from  an  enormous  system  of 
foreign  taxation,  the  argument  for  protection  becomes  one  of  great 
interest  and  of  supreme  force,  as  a  duty  of  patriotism. 

Without  attempting  to  philosophize  here  on  the  subject  of  instinct 
in  man,  it  may  be  remarked,  that  the  experience  of  the  people  of 
the  United  States,  has  awakened  what  we  are  disposed  to  call  an 
instinctive  apprehension  in  their  minds,  of  an  hostility  between  their 
labor  and  foreign  labor,  in  the  market  of  the  world  ;  more  espe- 
cially when  the  products  of  foreign  labor  are  brought  into  our  own 
market  to  compete  with  home  products.  They  feel  that  they  want 
protection  against  it,  and  that  protection  will  not  be  a  tax,  but  a 
benefit.  What  they  feel  is  true,  and  they  are  prepared  to  enter- 
tain the  proposition  above  announced,  before  they  hear  the  reasons, 
because  it  agrees  with  their  experience.  They  who  reason  on  this 
subject  independent  of  experience  and  fact,  and  against  both,  may 
feel  little  respect  for  such  deductions  of  the  common  mind.  But 
there  is  argument  in  them  notwithstanding.  There  is  no  American 
of  experience  and  observation  in  these  matters,  and  uninfected  with 
the  borrowed  theory  of  Free  Trade,  who  is  not  prepared  to  find 
the  proposition  of  this  chapter  sustained  by  facts.  He  anticipates 
it.  It  may  perhaps  be  called  the  instinct  of  experience,  or  of  na- 
ture prompted  by  experience  and  observation.  It  is  a  feeling  cre- 
ated, not  without  cause,  before  the  reason  of  it  is  clearly  under- 
stood. We  prefer  to  call  it  popular  instinct  —  the  instinct  of  a 
party  which  feels  that  its  interests  are  exposed  to  invasion  and  in- 
jury, and  that  they  need  protection. 

The  theory  of  Free  Trade   is,  that   duties   not  only   increase 


PROTECTIVE    DUTIES    NOT    TAXES.  353 

prices,  but  that  they  are  the  measure  of  the  increase.  It  is  not 
denied  that  (Uities  on  unprotected  articles  will  enhance  prices,  and 
that  for  this  reason  they  are  taxes,  as  duties  on  tea,  coffee,  spices, 
and  various  other  articles  which  can  not  be  produced  at  iiome. 
But  it  is  found  by  experience  that  they  are  never  an  exact  meas- 
ure. Sometimes  the  increase  of  price  on  such  articles  is  jrreater 
than  the  duties,  and  sometimes  it  is  less  —  ordinarily  less.  Wheth- 
er it  shall  be  ,e;reater  or  less,  depends  entirely  upon  supply  relative 
to  demand  —  a  rule  which  governs  prices  in  all  things.  Tlie  in- 
crease of  prices  of  unprotected  articles,  subject  to  duties,  is  ordi- 
narily less  than  the  amount  of  duties:  first,  because  the  producers, 
always  aware  of  the  duties  in  the  market  to  which  they  send,  are 
anxious  to  retain  the  market,  and  will  therefore  accept  of  less  profit ; 
next,  because  they  can  generally  afford  it;  and  thirdly,  because,  in 
regard  to  all  such  aiticles,  there  is  always  more  or  less  of  compe- 
tition in  the  places  of  their  production.  Except  in  cases  of  defect 
of  supply,  the  prices  will  rarely  rise  by  the  measure  of  the  duties. 
They  generally  (all  short,  by  a  moiety,  more  or  less.  This  fact  is 
a  complete  disturbance  of  the  theory  of  Free  Trade,  and  breaks  it 
up  entirely,  inasmuch  as  the  theory  supposes  that  the  prices  are 
raised  by  the  measure  of  the  duties,  which,  if  it  ever  happens,  is 
merely  an  accident,  and  never  the  effect  of  the  rule  which  Free 
Trade  lays  down.  That  duties  on  unprotected  articles  are  gener- 
ally taxes,  is  true  ;  but  it  is  not  true  that  the  duties  are  the  measure 
of  the  taxes. 

It  will  be  found,  that  protected  articles  fall  into  a  very  different 
position  under  duties,  and  that  they  are  subject  to  a  very  different  set 
of  influences,  as  to  the  effect  of  the  duties  on  the  prices,  when 
compared  with  the  effects  of  duties  on  the  prices  of  unprotected 
articles.  Duties  on  the  latter  affect  only  two  parties,  viz.,  the  for- 
eign producer  and  the  home  consumer,  both  of  which  will  naturally 
be  sensitive  on  the  subject.  The  producers  will  be  anxious  to 
retain  the  market,  and  if  they  think  they  can  sell  as  much  as  before 
the  duties  by  not  raising  the  prices  —  which  is  presumable  —  and 
if  they  find  by  calculation,  that  they  can  make  more  aggregate  profit 
in  this  way,  than  by  raising  prices  and  selling  Icr^s,  they  will  most 
assuredly  follow  this  course  ;  and  the  articles  will  come  into  mar- 
ket as  cheap  as  before  the  duties  were  imposed,  except,  perhaps, 
the  domestic  jobbers  and  retailers  will  find  an  apology  for  the  in- 
crease of  prices  and  their  own  [)rofifs,  by  pointing  to  the  duties. 
Tliere  may  also  be  a  foreign  competition,  when  articles,  such  as 

23 


354  PROTECTIVE  DUTIES  NOT  TAXES. 

coffee  and  many  other  things,  are  supplied  from  different  foreign 
coimtries,  which  also  tends  to  keep  down  prices.  These  obvious 
influences,  except  as  they  are  overcome  by  defect  of  sujiply  in  the 
market,  will  naturally  prevent  prices  from  rising  by  the  measure  of 
the  duties,  according  to  the  rule  laid  down  above.  AH  practical 
merchants  will  certify  to  the  correctness  of  this  view.  They  find 
that  prices,  in  some  cases,  and  for  a  while,  are  scarcely  affected  by 
the  duties  on  unprotected  articles,  except  as  advantage  is  taken  of 
the  fact  of  the  duties  in  the  home  market;  and  even  then  they 
rarely  come  up  to  the  measure  of  the  duties,  which,  as  before  re- 
marked, breaks  up  the  Free-Trade  theory  on  its  strongest  ground. 
For,  if  prices  are  raised  by  the  measure  of  duties,  as  that  tlieory 
alleges,  it  would  most  certainly  occur  in  the  case  of  unprotected 
articles,  where  there  is  no  home  competition  brought  into  the  field 
against  foreign. 

But  the  case  is  widely  different,  when  American  arts,  industry, 
and  labor,  come  into  competition,  under  a  system  of  protection, 
against  foreign  arts  and  labor.  The  most  vulnerable  point  of 
those  systems  of  foreign  despotism,  which,  for  centuries,  it  may  be 
said  for  ever,  have  held  labor  in  the  most  abject  condition,  is  as- 
sailed by  an  American  protective  system  —  and  assailed  to  their 
great  alarm  and  consternation.  It  is  assailed  by  a  young  giant, 
conscious,  or  who  ought  to  be  conscious,  of  the  strength  of  his  po- 
sition, and  of  the  weakness  of  his  adversaries.  And  why  are  those 
systems  of  despotism  alarmed,  when  they  behold  young  America, 
not  only  rising  and  spreading  herself  in  strength,  but  learning  and 
practising  those  arts  which  hitlierio  have  given  Europe  her  ascen- 
dency over  the  rest  of  the  world,  and  made  all  nations,  the  United 
States  among  the  rest,  tributaries  to  her  greatness,  her  power,  her 
thrones,  her  princes,  her  aristocracies,  her  towering  pride,  her 
pomp,  her  overgrown  institutions,  her  vast  wealth,  and  all  those 
elements  of  earthly  grandeur,  which  constitute  her  supremacy  and 
her  political  sway?  Why  is  Great  Britain  alarmed  at  this  spec- 
tacle?—  Because  it  is  the  starting  up  of  a  rival  which  she  fears  — 
and  fears  more  than  any  other.  And  wliat  is  the  specific  ground 
of  her  fear? — Simply  and  only  because  she  can  not  but  foresee 
in  this  rivalship  the  cheapening  of  the  products  of  her  own  arts 
and  labor,  in  the  United  States,  and  all  the  world  over — in  the  Uni- 
ted States,  her  best  market,*  and  in  the  market  of  the  world,  which 

•  The  followins  facts  will  show  the  relative  importance  of  the  United  States,  as 
a  maiket  for  British  manufactures.     By  a  recent  report  of  a  committee  of  the 


PROTECTIVE  DUTIES  NOT  TAXES.  355 

she  hnd  long  endeavored  to  monopolize.  The  arts  of  Great  Britain 
are  the  tower  of  her  strength  —  her  great  national  bulwark.  To  be 
undersold  and  superseded  in  them,  is  to  he  undermined. 

In  order  to  ascertain  the  influences  which  affect  the  prices  of 
protected  articles  in  the  United  States,  and  how  they  act,  it  is  ne- 
cessary to  consider  the  relative  position  of  this  country  to  Europe 
and  other  foreign  parts,  producers  of  the  same  things,  on  the  sub- 
jects embraced  in  the  question.  It  has  already  been  shown,  that 
Europe  occupies  a  strong  vantage  ground,  by  having  been  first  in 
the  field  of  the  arts,  so  as  to  have  made  superior  attainments;  and 
more  especially  by  having  availed  herself  of  the  abject  condition 
in  which  she  has  ever  held  labor,  so  that  it  does  not  cost  her,  on 
an  average,  more  than  one  third  of  its  cost  in  the  United  States. 
All  that  she  gains  by  this  usurpation  —  and  the  power  is  immense 
—  is  appropriated  chiefly  to  that  artificial  aggrandizement,  and  to 
those  prodigal  expenditures,  which,  for  the  maintenance  of  her 
power  and  pride,  characterize  the  nations  of  Europe.  Europe 
has  never  yet  found  it  necessary  to  use  any  considerable  fraction 
of  this  power  in  a  commercial  rivalship  with  free  states,  inasmuch 
as  such  states  have  never  risen  up  in  any  formidable  shape,  except 
in  the  case  of  the  United  States;  and  here  our  foreign  commercial 
policy  has  generally  been  so  lax  and  so  fluctuating,  as  to  give  the 
states  of  Europe  very  little  concern.  They  have  still  been  able  to 
go  on,  and  appropriate  the  power  they  derive  from  the  oppression 
of  labor,  as  they  have  done  from  time  immemorial.  The  arts  of 
Europe  have  made  the  world  tributary,  including  the  United  States; 
and  the  taxes  which  we,  as  well  as  other  parties,  have  been  accus- 
tomed to  pay  —  and  to  pay  without  dreaming  of  the  fact  that  it  was 
a  tax — to  support  the  power  and  superiority  of  European  nations, 
thus  acquired,  will  astonish  those  who  have  never  considered  the 
subject,  and  which  we  shall  endeavor,  in  the  proper  place,  to  lay 
open  to  view. 

But  the  point  to  which  we  desire,  in  this  place,  to  direct  atten- 
tion, is  the  fact,  that,  on  account  of  tlie  position  of  Europe,  in  rela- 
tion to  the  United  States,  and  of  the  latter  in  relation  to  the  former, 
politically  and  commercially,  and  on  account  of  the  large  margin 

Brilisli  house  of  commoas,  it  appears,  that  Prussia  consumes  annually  of  British 
manufiictiires  to  the  amount  of  7  cents  for  each  individual  of  her  population  ; 
Russia  lo  the  amount  of  16  cents  for  each  individual ;  Norway,  1'  cents  ;  France, 
20  cents;  and  the  United  States  to  the  amount  of  402  cents  for  each  individual  of 
our  population  ;  and  yet  there  is  scarcely  one  of  these  articles  which  we  could  not 
produce,  and  generally  at  a  lower  price. 


356  PROTECTIVE  DUTIES  NOT  TAXES. 

of  profit  which  is  derived  from  the  cheapness  of  European  labor, 
Europe  can  not  only  afford  to  abate  in  the  prices  of  the  products 
of  her  arts,  in  case  of  necessity,  in  the  starting  up  of  new  rivals,  but 
that  she  actually  does  so  when  she  is  forced  to  encounter  the  rival- 
ship  of  American  arts  and  labor  enjoying  protection  under  the  gov- 
ernment of  the  United  States ;  and  that  the  entire  scale  of  pri- 
ces, in  regard  to  all  the  articles  comprehended  in  such  protection, 
whether  the  duties  are  prohibitory  or  not,  is  materially  reduced  in 
consequence  of  the  adoption  of  the  system.  There  may  be,  and 
doubtless  are,  some  trifling  and  transient  exceptions  to  this  rule  ; 
but  none,  as  will  yet  be  seen,  which  ever  were,  are,  or  can  be,  a 
burden  or  tax  to  any  party  or  person  in  the  United  States,  when 
all  the  benefits  of  the  system  to  every  party  or  person  are  con- 
sidered. 

It  has  already  been  seen,  that  the  theory  of  Free  Trade,  which 
avers,  that  prices  are  enhanced  by  the  measure  of  the  duties,  fails 
even  in  its  application  to  unprotected  arliiles,  where  it  might  natu- 
rally, and  at  first  sight,  be  expected,  that  it  would  hold  good.  But 
even  there  practice  subverts  and  demolishes  the  theory.  How  much 
more  when  it  comes  to  encounter  the  stupendous  influences  which 
are  brought  into  action  by  a  collision  of  European  arts  and  labor 
with  American  arts  and  labor  ?  This  strife  is  the  shock  of  empires, 
literally,  without  a  figure  ;  and  the  theory  of  Free  Trade,  so  far 
as  its  doctrine  of  prices  and  taxation  is  concerned,  has  no  more 
chance  to  establish  a  footing  in  this  warfare,  than  the  poor  traveller 
in  the  Alps,  who  finds  himself  swept  into  the  deep  abyss  below, 
and  buried  for  ever,  by  an  avalanche  that  comes  thundering  from 
on  high.  Prices  are  of  little  account  to  the  nations  of  Europe, 
esptcially  to  Great  Britain,  in  this  struggle,  so  long  as  the  sacrifices 
are  merely  negative  —  so  long  as  money  is  not  lost  —  and  even  that 
may  be  endured  for  a  season.  Tt  is  a  strife  for  relative  ascendency, 
advantage,  power,  in  which  such  sacrifices  are  made  by  them,  in 
hope  of  victory.  Ever  since  the  American  fathers,  while  under 
the  crown,  began  to  supply  their  own  wants,  down  to  this  time,  and 
so  far  as  the  people  have  succeeded,  with  or  without  protection, 
the  prices  of  the  articles  they  have  produced,  have  been  cheapened  ; 
never  more  than  under  a  protective  system  ;  never  so  much,  or  so 
fast.  The  competition  is  a  vast  and  comprehensive  system  of  com- 
mercial rivalship,  in  which  nations,  the  greatest  and  most  powerful, 
are  engaged,  by  their  systems  of  commercial  policy;  in  which  they 
have  long  been  engaged,  and  were  never  so  active  and  jealous  as 


PROTECTIVE  DUTIES  NOT  TAXES.  357 

at  this  moment.  The  consequence  is,  that  the  prices  of  articles 
comprehended  in  these  schemes,  have  been  reduced,  generally  and 
particularly,  to  a  degree  which  could  never  have  been  experienced 
without  this  competition. 

Tliere  is  not  only  a  large  margin  in  Europe  to  reduce  prices,  by 
the  wrong  that  is  done  to  labor  there  —  though  no  more  of  it  will 
be  used  than  what  is  absolutely  necessary — but  there  is  an  im- 
mense, an  inexhaustible  power  in  the  United  States  to  do  the  same 
thing,  under  an  adequate  system  of  protection,  much  of  which  has 
already  been  employed  to  that  end.  The  power  here  consists 
chiefly  in  the  cheapness  of  our  government,  the  freedom  of  our  in- 
stitutions, the  enterprise  of  the  people,  the  increase  of  population, 
increasing  wants,  and  the  vast  physical  capabilities  of  the  country. 
Two  things  only  render  a  protective  system  necessary  to  us  :  Our 
inferiority  in  the  arts,  and  the  higher  price  of  labor.  The  first  may, 
perhaps,  cease  to  exist,  in  progress  of  time  ;  but  the  second  can  not 
cease  to  make  the  same  demand  for  protection,  as  it  now  does,  so 
long  as  our  social  organization  and  that  of  other  foreign  parts  re- 
main the  same.  American  labor  must  be  sustained,  which  can 
only  be  effected  by  a  system  of  Protection,  against  cheap  foreign 
labor.  But  after  securing  to  labor  a  proper  reward,  under  an  ade- 
quate system  of  Protection,  the  remaining  power  of  sustaining  a 
commercial  com(>etition  with  Europe  and  other  parts,  so  as  to  re- 
duce the  prices  of  protected  articles  lower  than  European  produ- 
cers under  their  system  of  taxation  can  afford,  will  be  ample,  and 
must  necessarily  be  so  employed  by  the  force  of  competition,  so 
long  as  competition  can  be  sustained  ;  and  when  that  ceases  from 
abroad,  it  will  only  be  because  American  power  has  won  the  day 
in  the  market  of  the  world,  when  it  will  still  go  on  reducing  prices 
of  the  same  articles  at  home,  by  domestic  competition,  as  is  ac- 
knowledged by  M.  Say,  in  the  following  words  :  "A  government 
can  not,  by  prohibition,  elevate  a  product  above  the  natural  rate 
of  price  ;  for,  in  that  case,  the  home  producers  would  betake 
themselves,  in  greater  numbers,  to  its  production,  and  by  competi- 
tion, reduce  the  profits  upon  it  to  the  general  level."  Ricardo  also 
confesses  the  same. 

We  have  said,  in  substance,  that  American  power — ability  we 
mean,  all  things  considered  —  under  a  properly-adjusted  system,  is 
amply  sufficient  to  reduce,  and  to  go  on  reducing,  the  prices  of 
protected  articles,  till  there  shall  be  no  foreign  competition,  in  the 
existing  state  of  the  world,  adequate  to  withstand  or  check  it. 


358  PROTECTIVE  DUTIES  NOT  TAXES. 

One  fraction  of  the  power,  not  inconsiderable,  which  abides 
with  the  American  people,  under  proper  protection,  to  oppose  that 
power  which  European  states  have  usurped  from  labor,  will  be 
absorbed  at  home  in  the  proper  compensation  of  American  labor. 
This  is  the  first  and  grand  object,  and  is  indispensable  to  the  per- 
petuity of  our  social  organization.  But  beyond  and  behind  that, 
are  vast  and  inexhaustible  faculties,  which  may  be  appropriated  to  the 
same  great  end,  to  wit,  to  fortify  American  labor  in  its  riglits,  and 
to  goon  cheapening  the  products  of  art  and  manufacture,  as  would 
naturally  and  necessarily  be  the  result  of  domestic  competition, 
and  of  the  wide  market  of  the  world  which  would  open  before 
such  a  system  and  such  enterprise. 

When  once  the  arts  shall  have  attained  to  a  measure  of  improve- 
ment in  the  United  Stales,  equal  to  that  of  Europe,  and  labor  at 
the  same  time  being  adequately  protected,  the  power  of  the  coun- 
try will  be  vastly  superior  to  that  of  Europe,  or  of  any  other  parts, 
to  cheapen  protected  articles.  An  established  and  reliable  system 
of  protection,  recognised  as  the  permanent  policy  of  the  govern- 
ment, not  again  to  be  disturbed  or  impaired,  would  invoke  and 
draw  abundant  capital  into  every  branch  of  manufacture,  call  into 
existence  new  arts,  put  all  the  energies  of  the  people  into  active 
exertion,  extend  competition  in  every  enterprise,  till  every  city  and 
villao-e  would  be  filled  with  artists  and  mechanics,  and  the  whole 
country  crowded  with  workshops  and  manufactories,  to  pour  plenty 
into  the  lap  of  industry,  and  to  give  profitable  employment  to 
every  laborer.  The  farmer  would  feed  the  mechanic,  the  planter 
supply  raw  materials  for  the  manufacturer,  and  every  occupation 
of  life  would  open  a  market  for  other  occupations.  All  the  prod- 
ucts of  art  would  grow  cheaper  and  cheaper  by  competition,  and 
still  each  of  those  pursuits  would  be  a  good  business,  by  increased 
demand  at  home  and  abroad,  till  every  nation  on  earth  would  be 
rivalled  in  the  market  of  the  world,  in  every  product  of  the  man- 
ufactures and  the  arts,  simply  because  no  other  nation  has  so  much 
inherent  power  to  cheapen  such  products  as  the  United  States. 
Tlie  nations  of  Europe  can  not  give  back  to  labor  what  they  have 
robbed  it  of,  or  use  all  this  power  in  commercial  competition,  and 
maintain  their  existence.  They  may  use  a  part  of  it  successfully 
against  the  United  States,  so  long  as  we  are  not  adequately  pro- 
tected ;  but  after  that,  all  their  efforts  and  sacrifices  will  be  in  vain 
till  they  abandon  their  system  of  usurping  the  rights  of  labor,  which 
would  of  course  be  their  destruction,  as  to  the  existing  forms  of 
society. 


PROTECTIVE  DUTIES  NOT  TAXES.  359 

The  cheapness  of  the  American  government,  and  the  economy 
©f  its  institutions,  as  contrasted  with  tiie  prodigal  expenditures  of 
European  governments  and  society,  exhibit  one  vast  item  of  the 
power  of  which  we  are  now  speaking ;  and  it  is  shown  in  another 
place,  that  the  very  revenues  of  the  American  government,  raised 
by  a  properly-adjusted  system  of  protection,  not  being  taxes,  may 
be  made  one  of  the  most  effective  means  of  national  wealth,  of 
which  it  is  possible  to  conceive.  Such  is  the  position  of  this  coun- 
try, such  her  power,  such  her  capabilities,  moral  and  physical,  and 
such  her  social  organization  as  intended  and  accomplished,  if  not 
perverted,  if  faithfully  carried  out,  and  if  sustained  in  her  career 
to  the  consummation  of  her  jiossibie  destiny,  that  all  the  expenses 
©f  government,  and  all  war-debts  not  swelling  beyond  any  probable 
amount  now  in  prospect,  may  be  defrayed,  and  a  sound  credit 
maintained,  without  taxing  the  people  a  penny ;  that  is,  by  a  sys- 
tem of  protection,  the  avails  of  which  shall  be  equal  to  al!  these 
purposes,  at  the  same  time  that  it  promotes  and  secures  the  inter- 
ests o[  all  and  of  each,  without  being  a  burden  or  tax  to  any  ;  at 
die  same  time  tJiat  national  weahh  shall  go  on  augmenting,  with- 
out interruption,  without  measure,  and  without  end. 

The  influences  of  an  American  protective  system  all  tend  to  the 
reduction  of  the  prices  of  protected  articles,  and  not,  as  Free 
Trade  asserts,  to  their  augmentation.  This  appears,  first,  from  the 
fact  that  an  earnest  show  of  establishing  and  maintaining  a  protec- 
tive policy  in  the  United  States,  produces  instantaneous  alarm  in 
Europe,  on  account  of  the  importance  of  our  commercial  position, 
and  impairs  their  pow€r  to  maintain  the  prices  of  their  products  in 
our  market;  secondly,  because  it  is  manifest  from  the  reason  of 
the  case,  that  such  a  collision  of  great  commercial  interests,  in  the 
way  of  competition,  by  extending  the  scale  and  multiplying  the 
(Competitors,  must  necessarily  reduce  prices;  thirdly,  because  the 
collision  isaetually  a  shock  of  two  vast  commercial  spheres,  coming 
athwart  each  other  in  hostile  encounter,  in  which  a  nice  adjustment 
of  small  things  is  not  to  be  thought  of;  and  fourthly,  because  the 
actual  and  uniform  operation  of  protection  in  the  United  States,  is 
to  reduce  the  prices  of  protected  articles,  as  shown  farther  on 
in  this  chapter.  No  man  has  ever  yet  been  able  to  point  to  a 
single  article,  the  price  of  which  has  been  permanently  raised 
by  a  protective  system;  whereas  the  proofs  on  the  other  side 
are  overwhelming.  No  reasonable  mind  can  resist  them.  It  is 
true,  indeed,  that  we  have  the  utterances  of  Free-Trade  theorists, 


360  PROTECTIVE  DUTIES  NOT  TAXES. 

concocted  in  the  closet,  and  thrust  upon  the  public  with  a  boldness 
in  the  inverse  ratio  of  tlie  reasons  and  facts.  Next,  we  find  them 
incorporated  in  presidential  messages,  and  treasury  reports,  sent 
forth  with  such  a  sanction,  wifhout  shame  or  compunction,  showing 
that  men  occupying  the  position  and  burdened  with  the  responsi- 
bilities of  statesmen,  ran  be  as  innocent,  because  they  are  as  igno- 
rant, as  the  schoolboy  who  rejoices  in  the  first  achievements  he 
imacines  he  has  made  in  figures,  when  tlie  master  comes  along  and 
boxes  his  ears  for  his  blunders.  The  advocates  of  Free  Trade 
have  too  much  complacency  in  their  theory,  and  are  too  much  sub- 
limated thereby,  to  be  disturbed  by  facts.  They  are  like  the  Mis- 
sissippi steamboat,  which  the  Yankee  in  London  boasted  could 
jump  the  snags  and  sand-banks,  and  could  hardly  be  held  up  at 
watering-places.  We  are  aware  it  may  be  said  that  such  disre- 
spectful treatment  of  opponents  is  rather  a  falling  down  from  the 
dignity  of  grave  argument.  But  it  is  written  by  high  authority, 
"  answer  a  fool  according  to  his  folly."  How  is  it  possible  to  rea- 
son with  those  who  contemn  the  facts  of  all  history,  and  require 
faith  in  their  dogmas,  against  all  experience?  And  when  a  presi- 
dent of  the  United  States  and  his  secretary  of  the  treasury,  have 
both  flown  off  into  the  clouds,  American  citizens  who  are  obliged 
to  stay  behind,  in  the  vulgar  walks  of  life,  may  be  excused  for 
thinking  it  meet  to  look  after  their  own  affairs.  It  is  strange  —  the 
wonder  of  the  age  —  that  the  people  of  the  United  States  could 
have  been  so  profoundly,  so  fatally  duped,  as  of  late,  on  this  great 
and  momentous  subject ;  and  not  less  strange,  that  the  highest  pub- 
lic functionaries  of  the  land  should  have  ministered  to  the  imposi- 
tion. 

The  first  class  of  facts  which  we  propose  to  notice,  to  show  that 
protective  duties  tend  to  reduce  prices,  and  actually  reduce  them, 
instead  of  raising  them,  as  the  advocates  of  Free  Trade  allege,  will 
be  found  in  the  history  of  the  manufacture  of  cotton  in  the  United 
States,  so  far  as  it  relates  to  this  question. 

Cotton  goods  which  cost  85  cents  a  yard  before  the  tariff  of 
1816,  have  been  reduced  to  7  cents.  Cotton  shirtings  have  fallen, 
under  the  system  of  protection,  from  25  cents  a  yard  to  5  ;  sheet- 
ings, from  32  to  7  ;  checks,  from  32  to  8  ;  striped  and  plain  ging- 
hams, from  26  to  8;  printed  calicoes,  from  20  in  1826,  to  9  in 
1844  ;  —  each  of  the  above  being  supposed  to  be  of  the  same'qual- 
ity  at  the  high  and  reduced  prices.  The  fact  that  the  British  gov- 
ernment have  been  obliged  to   enact  differential  duties  for  their 


PROTECTIVE  DUTIES  NOT  TAXES.  361 

eastern  dependencies,  first  of  5  per  cent.,  then  of  8^,  next  of  10^, 
and  finally  of  15,  to  exclude  American  cotton  goods,  is  co)»clusive 
evidence  that  the  American  manufacturers  can  and  do  sell  cheaper 
than  the  British.     This  is  a  great,  a  stupendous  result. 

From  1S09  to  1814,  before  cotton  was  manufactured  in  the  Uni- 
ted States,  the  British  duty  on  the  raw  material  was  2-5s.  6cl.  per 
cwt.,  or  nearly  5^  cents  a  pound.  From  1815  to  1819,  it  was  85. 
6d.  per  cwt.,  or  nearly  2  cents  a  pound.  At  last  it  got  down  to  2 
farthings  a  pound,  and  that  was  taken  off,  as  before  shown  Jor  jjro- 
tection  against  American  competition.  But  for  American  cotton 
manufactures,  the  American  cotton-grower  would  have  been  in  the 
power  of  the  British  government  at  this  moment,  with  a  duty 
against  him  in  England  of  5^  cents  a  pound  on  cotton,  more  or 
less. 

There  is  no  doubt,  if  this  domestic  and  world-wide  competition 
had  not  been  brought  into  the  field  by  the  American  protective  sys- 
tem, the  prices  of  cotton  goods  would  yet  have  been  kept  up  much 
above  what  they  are  at  present.  This  is  a  moral  certainty,  than 
which  nothing  can  be  more  certain.  Although  the  reduction  of 
prices  by  such  a  cause,  can  not  be  measured  with  precision,  yet  no 
one,  looking  at  the  causes,  as  they  operate  in  all  such  cases,  would 
deem  it  extravagant  to  conclude,  that,  if  the  monopoly  of  cotton 
manufactures  had  been  retained  by  Great  Britain,  and  consequently 
the  control  of  prices,  we  and  all  the  world  should  have  been  pay- 
ing at  this  moment,  at  least  an  average  of  one  hundred  per  cent, 
more  for  this  species  of  goods,  than  the  present  prices.  There  are 
the  facts  on  the  one  side,  in  the  history  of  the  reduction  of  prices; 
and  there  are  the  known  principles  of  human  nature  on  the  other, 
establishing  the  moral  certainty  as  to  how  men  will  act  in  given 
circumstances ;  that  is  to  say,  monopoly  is  not  addicted  to  cry  out 
against  its  own  prices,  or  to  reduce  them,  except  by  the  fear  or  by 
the  fact  of  competition. 

But  the  British  differential  duties,  above  cited,  enacted  expressly 
and  solely  to  protect  their  own  manufactures,  in  their  own  remote 
or  proximate  dependencies,  against  Ainerican  competition  in  those 
quarters  —  enactments  still  continued  for  the  same  purpose,  at  the 
highest  rate  of  duties  above  named,  the  lower  having  proved  insuffi- 
cient—  are  evidence  which  no  man  can  gainsay,  incontrovertibly 
conclusive,  if  it  had  been  possible  to  entertain  a  doubt  as  to  what 
is  proved  on  this  point,  in  the  history  of  the  reduction  of  prices, 
as  above  narrated.     Each  of  these  two  kinds  of  evidence  sustains 


362  PROTECTIVE    DUTIES    NOT    TAXES. 

the  other,  and  the  second,  being  a  demonstration,  imparts  the  same 
character  to  the  first. 

It  is  the  general  influence  of  a  protective  system  which  affects 
details.  It  is  seen  in  its  results.  Jn  the  setting-up  of  cotton  man- 
ufactures in  the  United  Stales,  under  legislative  encouragement, 
this  country  started  up  a  great  commercial  rival  to  a  great  commer- 
cial nation,  in  this  particular — to  a  nation  with  which  this  s|)ecies 
of  production  was  of  vital  importance  —  to  a  nation  which  had  not 
only  been  accustomed  to  supply  us,  but  the  world,  with  these  prod- 
ucts, with  little  opposition.  The  effect  of  this  competition  on  so 
large,  so  vast  a  scale  —  in  a  sphere  which  in  prospect  embraced  all 
nations  —  was,  as  might  have  been  expected,  and  as  accords  with  the 
experience  of  the  whole  commercial  world  at  all  times,  soon  very 
perceptible  in  the  reduction  of  prices.  The  influence  was  even 
more  comprehensive  than  that  on  the  articles  protected.  It  affected 
trade  generally  in  the  same  way,  as  is  always  the  case.  Every  ar- 
ticle within  the  range  of  protection  went  down,  and  was  kept  down 
by  protection,  whether  the  duties  were  prohibitory  or  not.  It  is 
the  general  influence,  and  the  influence  in  the  long  run,  for  a  course 
of  years,  which  tells  most  emphatically  on  this  question,  as  the 
history  of  reduction  of  the  prices  of  cotton  goods,  since  the  Ameri- 
can protective  system  was  spread  over  this  species  of  merchandise, 
will  show.  —  And  t[)is  general  influence  comprehends  all  particular 
cases  —  not  one  of  them  escapes. 

They  who  refuse  to  give  up  to  such  facts  as  these,  defend  them- 
selves by  pointing  to  tiie  prices  current  of  the  protected  articles  in  for- 
eio-n  markets,  and  in  the  American  market,  by  which  they  think  they 
have  a  show  of  vindication,  inasmuch  as,  in  some  cases,  they  can,  by 
this  means,  prove  lower  prices  abroad  than  at  home.  This,  however, 
is  a  very  narrow,  altogether  too  restricted  a  view  of  the  facts  that  be- 
long to  the  question.  In  the  first  place,  they  leave  out  of  the  ac- 
count the  general  reduction  of  prices  that  has  already  been  produced 
by  the  protective  system,  which  Is  the  principal  item  that  claims  to 
be  considered.  Next,  they  do  not  consider  that  these  foreign  pro- 
ducers, especially  in  articles  prohibited  from  the  American  market, 
have  been  restricted  to  a  narrower  sphere  of  trade,  and  conse- 
quendy  to  one  of  a  more  active  competition  between  themselves, 
which  of  course  reduces  prices  In  those  quarters  lower  than  they 
would  otherwise  be.  Thirdly,  they  do  not  consider  the  accidental 
surpluses  which  are  accumulated  in  Europe,  by  bankruptcies  and 
over-production,  which.  If  the  American  market  were  open,  would 


PROTECTIVE  DUTIES  NOT  TAXES.  363 

be  floated  off  this  way,  to  keep  up  prices  ;  and  which,  Indeed,  even 
under  the  most  restrictive  system,  will,  in  large  amounts,  make 
their  way  here,  and  be  sold  at  a  sacrifice  on  the  cost.  And  fourthly, 
they  do  not  consider,  that,  as  soon  as  these  restrictions  are  removed, 
the  contest  between  the  competitors,  and  the  fact  of  cheap  goods, 
will  both  be  of  short  duration,  and  when  Europe  shall  have  beat 
America,  goods  will  be  higher  than  they  were  before  —  as  is  uni- 
versally found  to  be  the  fact.  At  this  moment,  three  months  after 
the  commencement  of  the  operation  of  the  tariff  of  1846,  while  we 
are  writing  this  page,  European  goods  are  imported  at  prices 
cheaper  than  they  can  be  afforded  here.  The  reason  is  twofold  : 
first,  to  dispose  of  the  surpluses  in  foreign  markets  ;  and  next,  on 
the  principle  disclosed  by  Lord  Brougham,  in  the  following  words 
of  a  speech  fuade  by  him  in  the  house  of  commons,  after  the  close 
of  the  war  of  JS12  :  "  It  is  well  worth  while  by  this  glut  [excessive 
exports  to  America]  to  stifle  in  the  cradle  those  rising  manufactories 
in  the  United  States."  As  soon  as  they  are  stifled,  or  in  any  de- 
gree checked,  by  such  means,  prices  will  rise.  Tlie  fall  is  no  per- 
manent good,  but  an  evil,  because  prices  will  in  the  end  be  higher 
than  they  ought  to  be  —  all  for  the  benefit  of  foreign  producers. 

Such  is  the  natural  operation  of  a  protective  system  in  the  Uni- 
ted Slates,  and  such  is  the  natural  result  of  disturbing  it.  The 
system  reduces  prices  generally  and  greatly;  the  removal  of  it  re- 
duces prices  only  slightly  and  transiently,  soon  to  rise  again,  higher 
than  they  were  before. 

Very  little  was  done  in  the  manufacture  of  woollen  goods  in  the 
United  States,  on  a  large  scale,  till  after  the  enactment  of  the  tariff 
of  1S24.  This  species  of  manufacture  had  been  carried  on,  more 
or  less,  in  families,  from  as  far  back  as  in  the  early  history  of  the 
colonies,  by  the  hands  of  the  wives  and  daughters  of  the  yeomanry 
of  the  land,  whose  husbands  and  fathers  kept  a  small  flock  of  sheep 
for  the  supply  of  the  raw  material.  This  home-made  cloth,  accord- 
ing to  the  doctrine  of  the  Free-Trade  economists,  was  a  very  ex- 
pensive way  of  supplying  wants,  inasmuch  as  the  labor  expended 
in  producing  them,  could  have  produced  many  times  the  value  in 
agriculture  and  other  ways  ;  which  may  be  beautifully  true  in  theory, 
if  these  economists  could  as  easily  find  a  market  for  those  other 
things.  But  it  was  necessary  that  the  people  shouldhave  clothing  ; 
they  had  not,  and  could  not  get  money,  to  buy  it  from  abroad  ; 
and' they  therefore  went  to  work  and  made  it  in  their  own  houses, 
as  the  Free-Trade  economists  say,  at  vast  expense.     How  was  it 


364  PROTECTIVE    DUTIES    NOT    TAXES. 

a  great  expense  ?  —  Thoy  employed  the  surplus  labor  of  their  own 
hands,  for  which  they  could  get  nothing,  in  any  other  way  ;  or  so 
economized  their  time  and  affairs,  and  so  interchanged  labor,  neigh- 
bor with  neighbor,  for  the  different  parts  of  the  work,  that  they  pro- 
duced home-made  cloth,  without  costing  them  a  penny  out  of 
porket.  Was  not  that  economy,  in  spite  of  the  doctrine  of  the 
Free-Trade  school?  —  Or  rather,  did  not  their  necessities  in- 
vent and  reduce  to  practice  the  most  salutary  principles  of  public 
economy?  —  This  way  of  supplying  home-made  clothing  of  all 
kinds — or  nearly  all  that  necessity  requires  —  is  within  the  recol- 
lection of  mariy  persons  now  living  ;  and  it  is  still  practised  exten- 
sively by  farmers,  who  consider  it  good  economy,  when  they  think 
of  what  their  means  of  buying  such  things  are,  and  how  much 
more  profitably  such  means  can  be  appropriated  to  other  purposes ; 
an(J  all  this  when  these  products,  made  in  this  way,  cost  ten,  or 
twenty,  or  in  some  cases  perhaps  fifty  times  as  much  labor,  as  the 
same  imported  articles  do.  This,  the  Free-Trade  economists  say, 
is  a  waste  —  a  tax.  But  the  farmers  who  still  wear  home-made 
cloih,  are  of  a  different  opinion.  They  know  thut  they  are  saving 
money,  and  growing  rich  faster,  by  it ;  and  they  will  leave  it  off 
just  so  soon  as,  and  no  sooner  than,  they  discover,  by  experience, 
that  they  can  supply  these  wants  with  less  labor  applied  to  other 
objects. 

But  the  tariff  of  1S24  gave  a  new  and  vigorous  impulse  to  the 
manufacture  of  American  woollen  goods,  on  a  large  scale  ;  and  the 
tariffs  of  '28  and  '32  increased  the  impetus  of  the  movement. 
Laro-e  investments  were  made  in  woollen  manufactories  in  various 
parts  of  the  country,  and  they  have  continued  to  increase,  from 
that  time  to  this,  under  somewhat  various  and  fluctuating  encour- 
agement. But  being  begun,  even  under  less  and  insufficient  pro- 
tection, they  could  not  be  closed,  without  a  sacrifice  of  capital. 
They  have  struggled  on,  sometimes  doing  a  profitable  business, 
and  sometimes  losing  money.  On  the  whole,  the  profits  of  this 
business  have  been  so  small,  that,  if  the  unstable  policy  of  the  gov- 
ernment had  been  foreseen,  it  is  more  than  probable  that  most  of 
these  establishments  would  never  have  been  set  up.  They  have, 
however,  produced  all  kinds  of  cloth,  from  the  lowest  prices  up  to 
the  highest ;  but  those  of  the  highest  have  generally  proved  un- 
profitable, on  account  of  the  comparative  imperfection  of  the  arts 
required  for  producing  them. 

Bui  the  prices  of  woollen  fabrics  of  the  more  common  sort  have 


PROTECTIVE    DUTIES    NOT    TAXES.  365 

fallen  immensely  since  they  began  to  be  produced  in  the  United 
States,  under  a  system  of  protection,  in  the  same  manner  as  in  the 
case  of  cotton  fabrics;  though  not  by  so  large  a  per  c^ent.  as  in  the 
latter,  inasmuch  as  competition  in  cotton  manufactures,  between 
this  country  and  Europe,  has  been  in  existence  nearly  or  quite 
twice  as  long  as  the  competition  in  the  production  of  woollens,  as 
stimulated  by  protection.  So  far  as  we  have  been  able  to  learn, 
we  should  not  hesitate  to  hazard  the  statement,  that  the  average 
reduction  of  prices  of  woollen  goods,  in  common  use,  in  twenty 
years  is  now  fifty  per  cent,  on  tlie  average  cost  that  time  ago ;  and 
the  low-priced  woollens,  in  which  American  competition  could  be 
better  sustained,  have  fallen  in  price  more  rapidly  and  more  con- 
siderably—  especially  under  the  tariff  of  1842.  Woollen  jeans, 
of  the  same  quality  which  sold  in  1840  at  65  cents  a  yard,  sold  in 
1S4G  for  35  cents.  A  correspondent  of  the  Journal  of  Commerce, 
understood  to  be  one  of  the  editors,  found  a  Yankee  trader,  at 
Cleveland,  Ohio,  in  the  summer  of  J  846,  who  had  settled  in  Can- 
ada, buying  satinets  and  other  low-priced  woollen  goods,  who  said 
he  could  pay  the  duties,  on  entering  Canada,  and  make  more  on 
them,  than  to  get  British  goods  at  Montreal.  In  this  case  of  the 
Yankee  from  Canada,  it  is  seen,  that  the  American  prices,  subject 
to  the  Britisli  duty  on  entering  Canada,  were  more  favorable  to  the 
trader  than  the  same  kind  of  British  goods  without  duty.  It  is  a 
very  strong  case  of  fact,  and  as  far  as  it  goes  —  and  it  seems  to 
comprehend  the  entire  range  of  low-priced  woollen  goods  —  it  is 
conclusive. 

But  the  experience  of  the  whole  country  —  of  all  the  people  — 
will  answer  for  itself.  It  is  sufficiently  well  known,  that  the  above 
statements  are  in  harmony  with  the  facts  which  constitute  that  ex- 
perience. Woollen  goods  have  been  constantly  cheapening,  under 
a  system  of  protection,  and  of  a  more  widely-extended  competition  ; 
and  there  is  no  reasonable  mode  of  accounting  for  the  facts,  con- 
sidering how  rapid  and  great  has  been  the  reduction  of  prices,  ex- 
cept that  it  is  occasioned  by  the  operation  of  protective  measures. 
It  is  the  natural  result  of  bringing  into  a  commercial  rivalship  the 
interests  of  two  grand  commercial  spheres,  each  of  which  aims,  not 
only  to  supply  its  own  market,  but  to  put  in  for  the  market  of  the 
world,  against  the  other.  Each  is  aware  how  much  is  at  stake, 
and  each  is  resolved  not  to  be  beaten,  but  if  possible  to  beat.  It 
has  been  seen  by  the  facts  and  reasonings  of  the  preceding  pages, 
that  neither  the  arts  nor  labor  of  the  United  States  can  compete 


366  PROTECTIVE  DUTIES  NOT  TAXES. 

with  tliose  of  Europe,  without  protection,  because  the  arts  here  are 
comparatively  iiDperfect,  and  the  labor  costs  three  times  as  much. 
It  has  also  been  shown,  that,  with  adequate  protection,  any  article 
that  can  be  produced  at  all  in  this  country,  can  be  produced  at  a 
lower  price  than  in  any  other  ;  and  that  the  power  of  the  couutry 
is  ample  for  that  purpose,  under,  and  only  under,  a  protective  sys- 
tem. This  explains  all  the  facts  of  our  history  now  under  consid- 
eration, and  there  is  no  other  ex|ilanation.  The  Aicts  are  indispu- 
table, and  these  results  have  been  repeatedly  broufjht  foiwiird  in 
evidence.  And  why  do  they  not  avail  to  establish  the  doctrine  of 
reduction  of  prices  by  protection?  Simply  and  only  because  they 
do  not  accord  with  the  theory  of  a  "science  falsely  so  called." 
Stdl  the  facts  abide  ;  the  results  are  uniform  ;  and  they  can  not  be 
otherwise  explained.  It  is  said,  indeed,  that  if  you  abate  or  abol- 
ish the  duties,  the  prices  will  be  reduced  ;  and  it  is  admitted,  tiiat, 
in  most  cases,  it  will  be  so  in  some  degree,  and  for  a  transient  pe- 
riod. Biit  this  is  answered  above.  It  is  simply  the  effect  of  the 
struggles  of  an  adversary  that  has  been  woisted,  who,  seeing  his 
hopes  revived  by  the  imprudence  of  the  other  party,  makes  a  new 
effort,  and  risks  new  sacrifices,  to  recover  his  former  advantageous 
position  ;  and  who  will  show  little  favor,  when  once  lie  has 
gained  it. 

Iron,  if  not  the  greatest  interest  of  the  country,  all  things  con- 
sidered, is  the  most  important.  It  enters  into  every  person's  wants, 
and  into  his  constant  use,  and  no  one  can  do  without  it-in  a  variety 
of  forms.  It  constitutes  the  most  prominent  necessity  of  war,  of 
peace,  of  agriculture,  of  manufactures,  of  commerce,  and  it  maybe 
said,  of  every  pursuit  of  life.  It  enters  even  into  the  finest  embellish- 
ments of  the  arts.  Time,  that  most  momentous  of  all  movements, 
carrying  with  it  the  destinies  of  all  nations,  and  of  all  men,  can  not 
be  accurately  measured  in  its  progress,  without  it. 

By  the  wise  arrangements  of  Providence,  the  necessities  of  man 
and  of  society  are  abundantly  provided  for,  in  this  particular,  in 
the  mineral  wealth  of  the  United  Slates.  'I'he  iron-beds  of  this 
country  have  already  been  ascertained  to  be  inexhaustible  ;  and 
what  is  not  of  less  importance — greater,  indeed  —  the  qualities  of 
iron  produced  from  the  ores  found  here  are  the  best  in  the  world. 
The  question  is,  wheiher  this  immense  and  boundless  field  of 
American  wealth  shall  be  protected  and  husbanded  ;  or  whether  it 
shall  be  abandoned  to  everlasting  repose,  for  the  sake  of  giving 
profit  to  British  producers  and   manufacturers  of  this  article,  and 


PROTECTIVE  DUTIES  NOT  TAXES.  367 

income  to  the  British  exchequer?  It  is  alleged  that  fvee  trade  in 
this  article  will  bring  it  cheaper  to  the  people  of  ihe  United  States. 
Siippo-e  it  should,  that  which  is  nominally  cheaper  is  not  always 
the  ciieapest.  The  main  proposition,  however,  is  flatly  and  con- 
fidently denied,  with  the  additional  averment,  that  adequate  and 
permanent  protection  of  the  home  product  and  manufactures  of  this 
article  will  afford  it,  in  all  forms,  at  lower  prices  to  the  people  than 
could  be  obtained  from  any  other  quarter,  besides  the  advantages 
to  the  country  of  the  home  trade.  The  prices  of  the  British  mar- 
ket to-day,  or  this  year,  are  no  rule  for  to-morrow,  or  next  year. 
They  are  as  variable  as  the  winds,  and  as  fickle  in  their  disposition 
—  governed  chiefly  by  their  chances  of  obtaining  the  American 
market,  or  for  want  of  it.  When  it  is  gained,  and  the  American 
product  is  rt-pressed,  their  prices  are  sure  to  be  high  ;  and  when  it 
is  wanted,  they  are  low. 

The  protective  system  over  iron  and  its  manufactures  began  in 
the  United  States  when  prices  were  very  high,  and  the  consequence 
has  been  a  uniform  and  gradual  reduction  of  prices.  Take,  for 
example,  the  extracts,  in  the  note  below,  from  the  report  on  iron 
of  the  convention  of  the  friends  of  domestic  industry,  held  in  the 
city  of  New  York,  November,  1S31,  signed  "B  B.  Howell,  Sec- 
retary."* 

"  "  Statemknt  B.  —  Showing  the  effects  of  a  tariff  of  protection  on  the  article  of 
iron  at  Pitlsbiir?  and  Cincinnati :  In  the  years  l8l8-'l9-'20,  bar  iron  in  Pitt.'^burg 
sold  at  from  $190  to  $200  per  ton.  — Now  the  price  is  $100  per  ton.  In  the  same 
year  boiler-iron  was  $350  per  ton.  —  Now  at  $1  -10  per  ton.  Sheet-iron  was  but  lit- 
tle m:t<Je  in  those  years,  and  sold  for  $18  per  cwt.  —  Now  made  in  abundance,  and 
sold  for  $8  .oO  per  cwt.  Hoop-iron,  under  same  circumstances,  was  then  $250,  and 
is  now  $120.  Axes  were  then  $24  per  dozen,  and  are  now  12.  Scythes  are  now 
5t»  p<r  cent,  lower  than  they  were  then — as  are  spades  and  shovels.  Iron  hoes 
were  in  those  years  $!•  per  dozen  —  now  a  very  superior  article  of  s/eel  hoes  al  $4 
to  $4.50.  Socket-shovels  are  made  at  $4.50  by  the  same  individual  who,  a  few 
yeas  aso,  sold  them  at  $12  per  dozen.  Slater's  patent  stoves,  imported  from  Eng- 
land, sold  in  Pittsbur?  al  $350  to  $100.  —  A  much  superior  article  is  now  made 
there  and  sold' for  $125  to  $150.  English  vices  then  sold  for  20  to  22^  cents  per 
lb.;  now  a  superior  article  is  sold  at  10  to  IO5.  Brazier's  rods  in  1824  were  im- 
ported, and  cost  14  cents  per  lb.,  or  $313.60  per  ton.  —  Now  supplied  to  any 
amount  of  j  to  §  diameter,  at  $130  per  ton.  Steam-engines  have  fallen  in  price 
since  1823  one  half,  and  they  have  one  half  more  work  on  them.  The  engine  at 
the  Union  rolling-mill  (Pittsburg'),  in  1819,  cost  $11,000  —  a  much  superior  one 
of  130-horse  power,  for  Sligo  mill,  cost,  in  1826,  $3,000.  In  1830,  there  were 
made  in  Pittsburg  100  steam-engines.  In  1831,  150  will  be  made,  averaging 
$2,000 ;  or  $300,000  in  that  article  alone.  A  two-horse  power  engine  costs  $250 ; 
six-horse,  $500  ;  eight  to  nine  horse,  $700.  These  last  are  the  prices  delivered 
and  put  up.  Al  least  600  tons  of  iron  made  in  Pittsburg  are  manufactured  into 
other  articles  before  it  leaves  the  city,  from  steam-engines  of  the  largest  size,  down 


36S  PROTECTIVE  DUTIES  NOT  TAXES. 

Under  the  system  of  low  duties,  in  the  latter  stages  of  the  opera- 
tion of  the  compromise  act,  down  to  the  tariff  of  .1842,  as  is  well 
known,  the  iron  interest,  in  its  raw  products  and  manufactures,  suf- 
fered greatly  in  Pennsylvania  and  elsewhere  ;   and  it  is  equally 
well  known,  that  it  revived  again,  to  an  astonishing  degree,  under 
the  tariff  of  1842,  cheapening  manufactured  articles  in  proportion 
as  the  manufactories  were  multiplied,  and  competition  extended. 
These  facts  are  so  recent,  and  come  so  directly  within  the  obser- 
vation and  experience  of  the  public,  as  not  to  require  a  detail  of 
evidence.     They  demonstrate  ihe  general  tiulli,  that  home  products 
of  manufacture,  under  Protection,  ^e//t/  invariably  and  uniformly  to 
reduce  the  prices  of  the  articles.     That  the  prices  of  the  raw  ma- 
terial should  be  well  sustained,  is  as  desirable  as  that  those  of  agri- 
cultural products  should  be  ;  and  that  some  of  the  forms  of  iron 
manufacture,  such  as  railroad  iron,  had  not  got  down  to  the  lowest 
British  prices,  results  from    the  twofold  consideration,   first,   that 
immense  capital  was  required  to  establish  them,  and  next,  that  the 
policy  of  Protection  was  not  regarded  as  sufficiently  secure  to  incur 
the  risk.     But  the  experiments  made  in  this  and  other  branches  of 
iron  manufacture,  hiiherto,  in  their  incipient  stages,  and  embarrassed 
as  they  have  been  for  want  of  confidence  in  the  disposition  of  the 
government,  demonstrate,  satisfactorily,  that,  under  a  system  of  per- 

to  a  threepenny  nail.  Eisht  rolling  and  slitting  mills,  of  the  largest  power,  are  in 
the  city  of  Pittsburg,  five  of  which  have  been  erected  since  1828.  Thirty-eight 
new  furnaces  have  been  erected  since  1824  in  the  western  parts  of  Pennsylvania, 
and  that  part  of  Kentucky  bordering  on  the  Ohio  river,  most  of  them  since  1828. 
The  quantity  of  iron  -rolled  at  Pittsburg  was,  in  1828,  3,291  tons,  19  cwt. ;  in 
1829,  6,217  tons,  17  cwt. ;  in  1830,  9,282  tons,  2  cwt.  Being  an  increase  of  nearly 
200  per  cent,  in  two  years.  The  above  facts  were  furnished  by  members  of  the 
committee  residing  at  PiUsburg,  who  vouch  for  th'ir  accuracy. 

"Prices  of  Iron  at  Cincinnati.— In  1814  to  1818,  bar  iron  $200  to  $220  per  ton; 
now  $100,  $105,  $110.  The  fall  in  price's  has  been  nearly  as  follows  :  In  1826, 
bar  iron,  assorted,  $125  to  $135;  in  1827,  $120  to  $130;  in  1828,  $115  to  $125; 
in  1829,  $112.50  to  $122.50;  in  1830,  $100  to  $110  ;  in  1831,  $100  to  $1 10.  Cast- 
ings, including  hollow-ware,  1814  to  1818.  $120  to  $130  per  toni  present  price, 
$60  to  $65,  and  the  quality  much  improved." — Natiuaal  Magazine,  June,  18-15. 

It  appears  from  the  same  document,  that  hnmrnered  iron,  at  a  duty  of  $22.40  per 
ton,  sold  at  less  than  it  did  at  a  duty  of  $9.  It  also  increased  the  revenue  from 
that  source,  which,  under  the  law  of  1816.  at  a  duty  of  $9,  was  two  millions  and  a 
half;  and  under  the  law  of  1828,  at  a  duty  of  $22.40,  was  five  millions  and  a  half. 
These  are  by  no  means  remarkable  facts.  It  is  the  uniform  operation  of  the  pro- 
tective system,  to  cheapen  the  protfcted  articles,  and  to  auement  the  revenue. 
Under  such  a  system,  forciirn  pro:l\icers  can  no  longer  have  their  own  price.=,  be- 
cause they  alone  have  not  the  market,  but  are  obliged  to  s^ll  under  the  effects  of 
competition  ;  and  the  domestic  producers  incctin?  with  foreign  competition,  are  also 
influenced  in  the  same  way,  all  for  the  benefit  of  consumers. 


PROTECTIVE  DUTIES  NOT  TAXES.  369 

manent  and  secure  Protection,  every  branch  of  iron  mannfactnre 
would  afford  its  products  at  lower  prices  than  to  depend  on  im- 
ports. American  railroad  iron,  in  1846,  had  got  to  be  lower  than 
the  Briiish  product  was  in  1836,  free  of  duty. 

The  effect  of  protection  on  brown  susrar,  in  reducing  prices,  is 
remarkable,  as  shown,  in  part,  by  the  tables  of  the  secretary  of  the 
treasury,  in  his  annual  report  of  December,  1S46  (pp.  720,  '21). 
The  variations  there  found  correspond  with  what  would  be  expected 
from  tlie  two  causes  of  competition  and  amount  of  the  home  crop. 
In  1816,  when  we  were  dependent  on  the  foreign  product,  the  pri- 
ces of  brown  sugar  ranged  from  14^  cents  a  pound  to  16^.  In 
1820,  after  Protection  had  begun  to  produce  its  effect,  it  was  down 
to  from  85  to  12^  cents.  In  1825,  it  was  down  to  from  7^  to  10 
cents.  In  1S31,  to  from  5  to  7  cents.  In  1834— '5,  to  from  5^  to 
6.  This  year  was  a  large  crop.  Mark  how  the  price  was  affected 
in  1835-'(),  when  the  crop  fell  short  of  the  year  pievious  by  about 
one  third.  It  rose  to  from  10  to  II  cents,  not  because  there  was 
no  supply  in  the  foreign  market,  but  because  we  were  dejiniflcvt. 
From  that  time  to  1842— '3,  the  home  crop  being  good,  and  grad- 
ually increasing,  prices  gradually  fell,  when  that  year  the  home  crop 
was  unusually  large,  and  the  price  was  reduced  to  from  3f  to  4 
cents.  In  1843-'4,  the  home  crop  was  small,  and  prices  rose  to 
from  5^  to  Q>\  cents.  Again,  in  ]S44-'5,  with  a  large  home  crop, 
prices  were  from  3f  to  4f  cents.  It  should  be  remarked,  that  all 
this  while,  nearly  twenty  years,  a  part  of  the  supply  was  from 
abroad,  and  the  foreign  and  domestic  products  were  brought  into 
com])etition,  the  consequence  of  which  was  the  reduction  of  prices. 
But  tiie  moment  tlie  competition  was  diminished,  by  the  falling  off 
of  the  home  crop,  up  went  prices. 

Mr.  Calhoun  proved  by  figures  —  or  claimed  to  have  proved  — 
when  the  tariff  of  1842  was  under  debate,  that  the  duties  of  that 
bill  on  hemp  and  its  manufactures  would  be  a  tax  on  the  cotton 
interest  of  SI, 422,222  a  year.  Mr.  Toombs,  of  Georgia,  of  the 
29th  Congress,  who,  as  a  southern  man,  would  naturally  sympa- 
thize with  Mr.  Calhoun  on  this  subject,  in  view  of  the  facts,  also 
j)roved  hij  Jjguren,  while  the  tariff  of  1846  was  under  debate,  that 
Mr.  Calhoun  had  been  entirely  wrong  in  his  calculations  and  pre- 
dictions, and  that  the  protection  given  to  hemp  and  coiton-bagging, 
by  the  tariff  of  1842,  had  not  only  lowered  p,rices,  but  lowered 
them  more  even  than  Mr.  Calhoun  predicted  it  would  raise  them. 
•'Since  the  introduction  of  the  business  of  making  coiton-bagging 

24 


370  PROTECTIVE  DUTIES  NOT  TAXES. 

in  Kentucky,"  said  Mr.  Toombs  —  "since  our  own  countrymen 
have  come  into  competition  in  producing  it — the  price  of  bagging 
has  fallen  to  less  than  ove  third  of  its  average  price  before  that 
period.  .  .  We  now  make  good  bagging  in  Kentucky  more  than  5 
cents  per  yard  less  than  it  cost  in  Dundee,  in  1S42,  and  for  3  or  4 
cents  a  yard  less  than  the  present  price  in  Scotland"  —  (See  Na- 
tional Intelligencer,  August  29,  1846).  The  price  of  cotton-bag- 
ging, in  1838,  ranged  from  18  to  20  cents  per  yard  ;  in  1841,  from 
25  to  27  ;  in  1846,  from  8^  to  9^.  Bale  rope,  in  1838,  from  7  to 
8  cents  per  pound  ;  in  184J,  from  11  to  12  ;  in  1846,  from  3  to  4. 
And  yet  the  secretary  of  the  treasury,  in  his  report  of  December, 
1846,  in  the  face  of  these  facts,  being  guided  by  his  theory,  repre- 
sents the  duties  of  the  tariff  of  1842  on  these  articles,  as  ";in  enor- 
mous tax  that  inures  to  the  benefit  of  about  thirty  manufacturers". 
He  is  forced,  however,  to  call  the  facts  "a  mystery."  — "  We  are 
unable,"  he  says,  "  to  get  any  key  to  this  mystery,  from  the  <ictual 
prices  since  the  duties  were  imposed".  If  Mr.  Calhoun  had  not 
predicted  that  the  prices  would  rise,  and  put  down  the  rise  in  fig- 
ures, so  that  there  is  no  getting  away  from  them,  then  the  secretary 
might  have  solved  the  "mystery,"  by  saying,  it  is  true  that  prices 
have  fallen,  but  they  would  have  fallen  as  much  more  as  the  duties, 
without  them.  He  does  indeed  give  this  reason  in  another  part  of 
his  report;  but  he  hardly  had  courage  enough  to  give  it  in  juxta- 
position with  a  recognition  of  these  facts,  and  therefore  he  called 
them  a  "mystery." 

The  price  of  window-glass,  in  1824,  when  a  duty  of  $3  per  100 
feet  was  imposed,  was  $10.50  per  100  feet.  In  1828,  price  S6.50. 
In  1846,  price  of  8-by-lO,  most  used,  $2.25,  under  a  duty  of  $2. 
The  cut-glass  works  at  Wheeling,  Virginia,  were  forced  to  stop 
before  the  tariff  of  1842.  Under  that  tariff,  they  had  more  orders 
than  could  be  supplied,  and  sold  for  25  per  cent,  less  than  before. 
The  flint-glass  works  of  the  United  States,  in  1832,  were  in  num- 
ber 17  ;  reduced  to  5  in  1842 ;  rose  to  19  under  the  tariff  of  that 
year;  labor  in  them  rose  25  per  cent.,  and  the  articles  produced 
fell  25  per  cent.     So  generally  in  the  glass  business. 

In  a  report  of  the  committee  on  manufactures  (House  Doc.  420, 
1st  sess.  28th  Congress),  it  was  proved,  that  the  depression  in  the 
prices  of  23  different  kinds  of  manufactured  iron,  under  the  influ- 
ence of  the  tariff  of  1842,  ranged  from  10  to  46  per  cent.  —  average 
reduction  23  percent.;  that,  in  a  list  of  22  different  and  chief  ma- 
terials of  shipbuilding  and  rigging,  such  as  had  been  imported,  the 


PROTECTIVE  DUTIES  NOT  TAXES.  371 

fall  of  prices,  from  1842  to  1S44,  ranged  from  2  to  35  per  cent. 
—  average  reduction  17^  per  cent.;  that,  in  a  list  of  9  articles  of 
hardware,  protected  by  increased  duties  in  the  tariff  of  1842,  the 
fall  of  prices  ranged  from  13  to  30  per  cent.  — average  reduction 
15  per  cent.;  and  that,  in  a  numerous  list  of  other  manufactured 
articles  of  various  kinds,  exhibited  in  the  tables  of  that  report,  the 
reduction  of  prices,  under  the  tariff  of  1842,  which  afforded  them 
the  protection  of  increased  duties,  had  been  effected  in  some  such 
measures  as  above  cited.      The  evidence  presented  in  that  report, 
of  the  tendency  and  effect  of  Protection  to  reduce  prices  of  manu- 
factured  articles,  was  uniform,   decided,   and    unanswerable.     No 
one  has  ever  yet  been  able  to  point  to  a  single  manufactured  arti- 
cle, in  extensive  demand,  enjoying  protection  for  home  production, 
the  price  of  which  has  not  been  reduced;  and  the  higher  the  duty 
the  greater  the  reduction  of  prices. 

It  would  be  very  easy  to  compile  a  volume  of  facts  in 'evidence 
on  this  point,  if  it  were  necessary.     But  who  will  say,  that  those 
above  given,  are  insufficient  to  preve,  beyond   all  controversy  or 
doubt,  that  protective  duties,  in  the  United  States,  reduce  the  prices 
of  manufactured  articles?     "  Every  production,"  says  a  "  Southern 
Planter,"  in  his  "Notes  on  Political  Ecconomy,"  "the  result  of 
Protection   in   the  country,  has  been  brought  cheaper  and  better 
into  the  market,  than  before  such  Protection."  —  "  Practical  men," 
said  Mr.  Clay,  in  the  senate,  in  1832,  "  understand  very  well  this 
state  of  the  case,  whether  they  do  or  do  not  comprehend  the  causes 
which  produce  it.     I  have,  in   my  possession,  a  letter  from  a  re- 
spectable merchant,  well  known  to  me.     After  complainino-  of  the 
operation  of  the  tariff  of  1828,  on  the  articles  to  which  it  "applies 
some  of  which  he  had  imported,  and  that  his  purchases  havin-r  been 
made  in  England,  before  the  passage  of  that  tariff  was  known,  which 
produced  such  an  effect  upon  the  English  market,  that  the  articles 
could   not  be  resold  without  loss,  he  adds,  'for  it  reoUij  appears, 
that,  when  additional  duties  are  laid  upon  an  article,  it  then  be- 
comes loner,  instead  oUiiglier:  " 

It  is  marvellously  singular,  how,  for  want  of  fact  and  sound  argu- 
ment, the  strongest  evidence  of  reduced  prices  by  Protection,  has 
been  seized  upon  to  decry  Protection  as  producing  a  contrary  ef- 
fect, as  m  the  case  of  minimums,  which  have  invariably  reduced 
prices.  When  the  price  was  reduced,  the  duty',  on  the  minimum 
principle,  would  appear  to  rise  — did  rise,  in  respect  to  the  real 
value  ;  and  therefore  it  is  said  to  be  an  exorbitant  duty  !     In  this 


372  PROTECTIVE  DUTIES  NOT  TAXES. 

way,  a  minimum  duty,  beginning,  say  at  50  per  cent,  ad  valoreni, 
has  sometimes  mounted,  by  reduction  of  prices,  to  an  ad-valorera 
duty  of  200,  or  250,  or  800  per  cent.  "  Behold  !"  says  tiie  sage 
member  of  Congress  —  for  this  argument  has  been  used  by  ihat 
class  of  persons,  in  public  debate  —  "behold!"  he  says,  "what 
enormous  duties  !  what  enormous  prices  !  what  enormous  profits  !" 
Is  it  not  mortifying  to  an  American  citizen,  to  be  obliged  to  witness 
such  ignorance  or  such  dishonesty  —  for  one  or  the  other  it  must 
be  —  in  the  legislators  of  the  nation  ?  This  very  300  per  cent,  ad- 
valorem  duty,  on  an  article  bearing  a  minimum  duty  equal  to  50  per 
cent,  ad  valorem,  when  the  law  was  passed,  and  still  the  same,  is 
arithmetical  demonstration,  that  the  price  had  been  reduced  to  one 
sixth  of  what  it  was  when  the  duty  was  imposed.  The  higher  ad- 
valorem  estimates  rise  by  the  operation  of  niinimums,  so  much 
greater  the  reduction  of  price  ;  and  vice  verso.  But  it  is,  or  ought 
to  be,  enough,  that  everybody  knows  by  experience,  that  manufac- 
tured articles  in  extensive  use  and  demand,  are  cheaper  under  pro- 
tective duties,  than  under  low  duties,  or  Free  Trade  ;  and  that  a 
protective  tariff,  like  that  of  1842,  enables  the  people,  more  e-spe- 
cially  the  poor,  to  supply  their  wants,  as  a  whole,  at  less  cost,  while 
they  do  better  in  all  their  pursuits,  and  are  more  prosperous.  You 
can  not  convince  the  poorest  and  most  ignorant  man,  who  buys  his 
shirt  for  less  than  the  duty  on  that  species  of  goods,  tliat  he  2>"ys 
the  duty.  It  was  the  duty  that  cheapened  it;  and  if  he  were  to 
believe,  that  he  is  taxed  with  the  duty,  he  must  believe,  that,  with- 
out the  tax,  he  should  have  got  his  shirt  for  as  much  less  than  noth- 
ing as  the  difference  between  the  duty  and  price  ;  and  that  the 
tradesman  who  sold  him  the  goods,  should  not  only  not  have  sold 
them,  but  gicen  them  to  him,  and  the  difference  between  the  duty 
and  price  (o  hoof.  In  that  way  the  tradesman,  at  least,  would  pay 
the  duty.  But  the  truth  is,  nobody  pays  it,  if  it  is  a  domestic 
product,  as  in  such  a  case  it  must  be. 

Facts  enough  have  been  exhibited,  and  argument  enough  made, 
as  is  hoped,  to  show,  that  the  general  influence  of  a  protective  sys- 
tem, in  reducing  prices  of  manufactured  products,  is  so  entirely 
comprehensive,  that  no  article  can  escape  its  beneficent  effect,  in  the 
loni^  run.  Attempts  have  been  made  by  demagogues  —  we  are  sorry 
to  say  that  presidents  and  secretaries  of  the  treasury  have  been  found 
in  this  category  —  to  make  the  poor  believe,  that  they  are  wronged 
by  protective  measures,  as  well  in  their  rights  of  labor,  as  in  the 
enhanced  cost  of  manufactured  products  most  necessary  to  them. 


PROTECTIVE  DUTIES  NOT  TAXES.  373 

Some  of  the  most  reckless  and  groundless  statements  on  tl)is  point, 
totally  unsupported  by  facts  or  reason,  were  made  in  the  presi- 
dent's annual  messages,  and  in  the  annual  reports  of  his  secretary 
of  the  treasury,  for  1845  and  184G.  The  very  argument  on  mini- 
mums,  considered  above,  and  others  of  the  kind,  equally  false  and 
deceptive,  were  made  by  both  of  diese  high  functionaries.  One  is 
at  a  loss  whether  such  attempts  proceed  from  a  defect  of  under- 
standing or  vice  of  heart.  The  truth  is,  that  no  class  of  society  is 
so  much  benefited  by  protection  as  the  poor;  first,  because  all  low- 
priced  products  of  manufacture,  most  necessary  to  them,  such  as 
cottons,  woollens,  &c.,  are  cheapened  by  this  policy  in  a  greater 
proportion  than  any  other ;  and  next,  because  no  interest  is  benefited 
so  much  as  that  of  labor,  by  a  protective  system,  as  shown  in  other 
parts  of  this  work.  It  is  on  all  low-priced  articles  of  manufacture, 
used  by  the  poor,  that  American  arts  and  labor  can  compete  most 
successfully  with  foreign  arts  and  labor,  and  it  is  the  prices  of  these 
articles  which  are  first  and  most  considerably  reduced  under  an 
American  protective  system.  Nothing  is  more  evident  than  this, 
as  shown  by  the  facts  displayed  above,  and  as  brought  within  the 
reach  of  common  observation.* 

*  The  secretary  of  the  treasury,  in  his  annual  report  of  December,  1845,  which 
announced  the  project  of  the  tariff  of  1846,  laid  down  this  doctrine,  that  "  the 
duty  must  be  added  to  the  price,  and  paid  by  the  consumer — the  duty  constituting 
as  much  a  part  of  the  price  as  the  cost  of  the  production."  Also,  that  prices  would 
fall  hy  the  amount  of  duties  taken  off.  But  immediately  on  the  passage  of  the 
tariff  of  1846,  which  reduced  the  duties  on  salt,  the  price  of  Turk's  Island  salt 
rose,  in  the  place  of  its  production,  fifty  per  cent.  Liverpool  salt  and  low-priced 
cotton  goods  also  rose  in  England,  by  the  same  cause,  viz.,  the  news  of  the  reduc- 
tion of  the  American  tariff.  So  also  the  prices  of  sugar  and  molasses,  in  the  for- 
eign places  of  their  production,  rose  by  an  amount  equal  to  the  reduction  of  the 
American  duties.  These  facts  show,  first,  that  the  foreign  producer,  and  not  the 
American  consumer,  is  benefited  by  the  reduction  of  our  protective  duties;  next, 
that  the  foreign  producer,  and  n<Jt  the  American  consumer,  pays  the  protective 
duty  ;  and  thirdly,  that  the  American  consumer  of  a  protected  article  is  injured  by 
the  same  amount  in  which  the  foreign  producer  is  benefited,  by  the  reduction  of 
duties.     The  loss  is  all  American  ;  the  gain  all  foreign. 

Observe  the  following  quotations  of  prices  of  sugar  in  August  before,  and  in 
December  after,  the  tariff  of  1846  went  into  operation  : — 

Prices  of  Sugars, 

Aug.  12.                     Duty.  Dec.  28.                  Duty. 

St.  Croix 7i  a  8| 2|  cts.  per  lb.  8  a  9 U  cts.  per  lb. 

New  Orleans 5f  a  Tf 2^  cts.       "  7o8 li  cts.       " 

Cuba  Muscovado...  6i  a  7| 2|  cts.       "  7a  8 If  cts.       " 

Porto  Rico 6$  a  8   2|  cts.       "  6|  a  8§ Ij  cts.       « 

Next  compare  the  promised  average  Free  Trade  price  with  the  real  Free-Trade 
price : — 


374  PROTECTIVE    DUTIES    NOT    TAXATION.       , 

It  may  be  useful  here  to  present  some  of  the  reasons,  not  already 
suggested,  of  the  facts,  above  adduced,  to  prove,  that  protective 
duties  are  not  taxes,  but  a  rescue  from  taxation. 

When  a  duty  is  imposed  on  an  imported  manufactured  article 
from  Great  Britain,  or  elsewhere,  to  encourage  its  domestic  pro- 
duction, it  is  presupposed,  that  the  home  producer  could  not  com- 
pete with  the  foreigner  without  the  duty,  and  consequently  could 
not  stand.  It  must  be  seen,  then,  in  such  a  case,  that  the  foreign 
producer  has  the  market,  and  will  have  his  own  price.  There  is 
nothing  to  limit  his  price,  but  the  competition  from  foreign  quar- 
ters. That  competition  can  not  give  the  American  consumer  the 
benefit  of  cheap  foreign  labor ;  for  that  is  chiefly  absorbed  in  an 
enormous  system  of  taxation,  which  is  never  relaxed,  except  in  the 
political  competitions  of  the  commercial  policy  of  nations.  Then 
it  is  made  to  bear  with  tremendous  energy  on  the  prices  of  wages 
and  capital  in  the  United  States  ;  and  a  small  fraction  of  the  great 
difference  in  the  cost  of  money  and  labor  in  these  two  quarters, 
will  answer  all  the  purposes  of  such  a  policy,  when  the  American 
laborer  and  producer  are  not  protected  by  their  own  government. 

But  in  ordinary  private  competition,  in  foreign  quarters,  for  the 
market  in  the  United  States,  cheap  foreign  labor  is  no  benefit  to 
the  American  consumer.  He  saves  not  a  penny  on  that  score. 
Even  in  the  action  of  the  commercial  policy  of  foreign  nations,  his 
benefit  is  small,  which  is  more  than  counterbalanced  by  other  flicts 
under  the  control  of  foreign  powers  and  foreign  factors,  so  long  as 
home  production  can  not  come  into  the  field  of  competition.  When 
it  does,  of  course  he  is  benefited ;  and  that  is  the  object  contended 
for  by  protection. 

So  long,  therefore,  as  foreign  producers  of  manufactured  articles, 
which  might  be  produced  at  home,  under  a  system  of  protection, 
can  command  the  market  of  the  United  States,  these  articles  will 
always  come  at  the  highest  prices  that  can  be  commanded  by  the 
advantageous  position  of  the  producer-,  which  amounts  to  absolute 

Promised  average  Free-Trade  Price.  Real  Free-Trade  Price. 

St.  Croix 6    a  7^  25.92  per  cent,  hisher. 

New  Orleans 4^  a  6  42.85        "  " 

Cuba  Muscovado 51  a  6^  3043        "  " 

Porto  Rico 5-Ja6|  28.00        «  « 

An  average  of  31.80  per  cent,  dearer  under  Free-Trade. 

The  consumers  of  susar  were  told  that  the  tnriir  of  1842  made  New  Orleans 
sugar  2^  cents  per  pound  dearer,  this  beinsr  the  amount  of  duty;  or  in  tlie  lan- 
guage of  the  secretary  of  the  treasury,  above  cited,  "  the  duty  constituting  as 
much  a  part  of  the  price  as  the  cost  of  production." 


I 


PROTECTIVE    DUTIES    NOT    TAXES.  375 

control,  except  in  their  competition  with  each  other.  Being  to- 
getlier  interested  to  make  money,  and  to  make  the  most  possible, 
they  will  not  sell  at  loss,  but  only  at  profit. 

In  the  first  place,  then,  all  the  difference  between  the  cost  of 
money  and  labor  in  the  United  States  and  those  quarters  —  not  less 
than  100  |)er  cent.  —  is  absorbed  by  the  system  of  taxation  where 
the  goods  are  produced,  and  more  too — far  more,  as  a  part  of  gov- 
ernment policy,  when  it  is  known  that  there  is  no  competition  to 
operate  against  them,  in  the  market  where  the  goods  are  going. 
That  system  of  taxation  is  enormous,  and  for  Great  Britain,  was 
once  described  by  Henry,  now  Lord  Broui^ham,  as  follows : — 

"  Taxes  on  every  article  that  enters  the  mouth,  or  covers  the 
back,  or  is  placed  under  the  feet ;  taxes  upon  everything  that  is 
pleasant  to  see,  hear,  feel,  smell,  or  taste  ;  taxes  on  everything  on 
the  earth  and  the  waters  under  the  earth  —  on  everything  that 
comes  from  abroad,  or  is  grown  at  home  ;  taxes  on  the  raw  mate- 
rial, and  on  every  new  value  that  is  added  by  the  art  and  labor  of 
man  ;  taxes  on  the  spices  that  pamper  man's  appetite,  and  on  the 
drug  that  is  administered  to  his  disease  ;  taxes  on  the  ermine  that 
decorates  the  judge,  and  on  the  rope  that  hangs  the  criminal ;  taxes 
on  the  rich  man's  dainties,  and  on  the  poor  man's  salt ;  taxes  on 
the  ribands  of  the  bride,  and  on  the  brass  nails  of  her  coffin  ; — at 
bed,  or  at  board,  lying  down  or  rising  up,  we  must  pay.  The 
school-boy  spins  his  taxed  top  ;  the  beardless  youth  manages  his 
taxed  horse,  on  a  taxed  saddle,  with  a  taxed  bridle,  on  a  taxed  road  ; 
and  the  dying  Englishman,  pouring  his  medicine,  which  has  paid 
7  per  cent.,  into  a  spoon  that  has  paid  15  per  cent.,  flings  himself 
back  on  his  chintz  bed  which  has  paid  22  per  cent.,  makes  his  will 
on  a  stamp  which  has  paid  eight  pounds  (sterling),  and  expires  in 
the  arms  of  an  apothecary,  who  has  paid  100  pounds  (sterling)  for 
the  privilege  of  putting  him  to  death.  His  whole  property  is  then 
taxed  from  2  to  10  per  cent,  in  probate,  and  large  fees  are  de- 
manded for  burying  him  in  church.  His  virtues  are  handed  down 
to  posterity  on  taxed  marble,  and  he  is  gathered  to  his  fathers  to 
be  taxed  no  more." 

No,  not  so.  For  if  the  marble  which  perpetuates  his  name  and 
celebrates  his  virtues,  can  last  so  long,  he  is  taxed  till  the  morning 
of  the  resurrection  !  Taxed  for  the  privilege  of  coming  into  the 
world,  taxed  all  the  way  through  it,  taxed  on  his  passage  out  of  it, 
and  taxed  ever  after! 

This  immense,  comprehensive,  stupendous  system  of  taxation, 


376  PROTECTIVE  DUTIES  NOT  TAXES. 

falls,  in  varied  and  complicaled  forms,  on  the  English  producers 
of  the  manufactured  articles  consumed  by  Americans,  and  enters 
into  the  price  of  them  as  a  principal  part,  when  there  is  no  protec- 
tion to  i^uard  against  it ;  and  that  price,  in  such  cases,  is  higher, 
always,  and  much  higher  than  it  would  be,  if  the  articles  could  be 
produced  at  home,  under  a  system  of  adequate  protection. 

To  all  this  must  be  added  the  profits  of  the  commercial  agents 
or  factors,  engaged  in  the  sale  of  these  goods,  the  charges  of  clear- 
ance, transportation,  and  entry,  and  a  variety  of  expenses  accumu- 
lated in  such  transactions  between  remote  countries.  Is  it  a  mat- 
ter of  surprise,  then  —  should  it  not  be  expected  —  in  view  of  all 
these  facts,  that  the  same  goods  which  can  be  produced  at  home, 
under  protection,  will  be  afforded  to  the  consumers  cheaper,  while 
the  laborers,  and  all  the  parties  concerned  in  the  business,  are  well 
paid,  on  the  American  system  of  wages  and  other  values?  Such, 
evidently,  is  the  aspect  of  the  facts,  and  the  reasons  are  obvious — 
demonstrate  the  facts,  which,  being  facts,  need  no  other  proof. 

The  American  consumer  of  foreign  manufactured  articles,  there- 
fore, which  might  be  produced  at  home,  under  protection,  though 
he  obtain  them  free  of  duty,  derives  not  the  smallest  fraction  of 
benefit  from  foreign  cheap  labor  ;  nor  is  he  in  any  manner  or  de- 
gree taxed  by  protective  duties  which  oblige   him   to   supply  his 
wants  at  home.     He   gets   them  cheaper.     There   may  be,  and 
doubtless  are,  exceptions  to  this  rule,  as,  for  example,  in  the  infancy 
of  a  domestic  production,  which  has  received  protection  for  the 
sake  of  starting  it ;  or  in  the  slow  progress  of  another,  the   protec- 
tion of  which  is  inadequate,  or  too  insecure  by  political  agitation, 
to  invite  sufficient  capital  to  give  it  strength  and  vigor,  and  to  open 
a  wide  field   of  domestic  competition.     In  some  such  cases,  the 
prices  may  be  augmented  temporarily  ;  not  permanently,  however, 
when  the  policy  of  protection  is  considered   as  settled.     The  mo- 
ment a  product  of  manufacture  has  received  adequate  protection, 
considered  as  secure,  capital  rushes  into  it,  to  fill  the  market,  and 
reduce  prices  by  competition   to  the  lowest  point  of  a  fair  profit. 
And  all  experience  in  the  United  States  proves  —  the  above-cited 
facts  prove  —  that  all  interests  engaged  in  donjestic  manufactures, 
capital,  wages  of  labor,  prices  of  raw  materials  of  home  produc- 
tion, the  wages  of  all  the  variety  of  employments  which  they  create, 
pay  of  agents,  carriers,  and   i)rofits  of  merchants  engaged  in  the 
trade,  can   all  be  sustained,  and  well  sustained,  on  the  American 
system  of  wages  and  profits,  when  the  consumers  obtain  them  at  a 


PROTECTIVE  DUTIES  NOT  TAXES.  377 

lower  rate  than  they  would  be  afforded  by  importation.  In  the 
case  of  importation  without  competition,  the  consumers  are  in  the 
power  of  foreigners,  and  of  a  foreign  system  of  enormous  taxation; 
and  they  can  not  escape  from  the  burden,  in  the  shape  of  hii^h  pri- 
ces, resnhing  therefrom.  In  the  case  of  home  production,  under  the 
American  system  of  society,  which  costs  httle,  and  migiit  be  en- 
tirely sustained  by  protective  duties  alone,  at  the  same  time  that 
they  cheapen  the  articles  protected,  the  consumers  are  rescued  from 
the  power  of  foreigners,  and  all  parties  engaged  in  supplying  their 
wants  are  well  paid,  while  those  wants  are  supplied  at  a  lower  rate, 
and  wiih  a  better  article.  If  a  person  or  party,  here  and  there, 
may  have  to  pay  a  little  more  for  the  supply  of  a  particular  want, 
in  the  first  stages  of  home  production,  before  competition  enters  the 
field,  the  benefits  such  a  party  receives  from  the  general  system, 
much  more  than  counterbalance  this  alleged  tax,  so  that,  on  the 
whole,  it  is  not  a  tax. 

It  is  a  great  misfortune  to  this  subject,  that  economists  first,  the 
schools  next,  statesmen  third,  the  press  fourth,  and  the  public  fifth, 
like  a  flock  of  sheep,  that  jump  with  a  leader,  have  all  consecu- 
tively, and  in  the  end  together,  been  accustomed  to  take  for  granted 
that  all  duties  are  ftixrs.  Who  can  resist  such  a  common  error, 
and  turn  men's  minds  back  to  reason,  when  the  very  persons, 
statesmen,  conductors  of  the  press,  and  others,  who  know  it  is  an 
error,  are  yet  so  much  creatures  of  habit,  as  to  call  a/l  duties  taxes, 
without  discrimination?  Hence  the  advantage  of  their  aritao-onists 
—  both  j)arties  call  the  same  thing  by  a  misnomer.  To  allow  that 
they  are  taxes  is  giving  it  up.  There  can  be  no  argument  after 
that,  except  in  the  following  form,  which  is  indeed  unanswerable  : 

"  So  that  a  thing  is  made  and  supplied  at  home,  it  matters  little 
whether  it  costs  more  or  less.  This  is  broad  ground,  and  needs 
some  illustration,  because,  if  true,  it  does  away  all  the  objection 
that  can  be  offered  to  a  protecting  tariff.  It  makes  all  the  difference 
to  the  country,  taking  in  its  rounds  and  interchanges  of  labor, 
whether  a  dollar  is  laid  out  at  home,  or  abroad,  in  buying  an  article. 
When  it  goes  to  a  foreign  country  to  buy  a  thing,  if.  is  gave  fitr  ever, 
and  becomes  the  capital  or  dollar  of  that  country,  after  it  makes 
one  operation  only.  Whereas,  if  you  lay  out  that  dollar  at  home, 
in  the  neighborhood,  or  next  village,  or  next  state,  or  district,  for  an 
article,  it  remains  in  the  country,  and  is  still^a  part  of  the  capital  of 
the  country.  It  does  infinitely  more  than  that,  because  it  circulates 
and  repeats  its  operation  of  buying  an  article  perhaps  one  hundred 


378  PROTECTIVE  DUTIES  NOT  TAXES. 

times,  possibly  a  thousand  times,  and  in  its  rounds  serves  tlie  pur- 
poses of  a  hundred  or  a  thousand  dollars,  as  the  case  may  be.  In 
the  grand  rounds  of  its  circulation,  it  touches  as  many  springs  of 
industry,  as  it  does  hands,  and  is  all  the  time  doing  good.  When 
it  shall  have  done  all  this,  or  while  it  is  doing  it — for  the  thing 
never  ends  —  it  is  still  a  dollar,  and  counted  properly  among  the 
dollars  or  the  capital  of  the  country.  P^igures  can't  calculate  the 
difference,  therefore,  in  expending  a  dollar  at  home  or  abroad  ; 
even  the  geometrical  ratio  can't  accumulate  fast  enough  to  realize 
this  difference.  It  outstrips  everything  but  the  human  imagination 
in  its  progress.  If  the  article  should  cost  10  per  cent,  more  than 
the  foreign,  it  is  ten  times  made  up  in  this  grand  round  we  have 
alluded  to  by  the  rapid  repetition  of  the  thing.  It  is  again  made 
up  in  the  way  that  prices  tally,  or  adapt  themselves  to  each  other. 
If  the  seller  of  the  article  gets  a  little  more,  he  in  his  turn  pays  a 
little  more  to  the  laborers,  and  they  a  little  more  to  the  farmers,  they 
a  little  more  to  the  hands,  and  so  on  all  round  the  circle,  until  a  per- 
fect equilibrium  is  not  only  restored,  but  kept  up  between  all,  and  all 
prices  quadrate  into  a  perfect  system,  that,  in  the  rounds,  can  not 
make  the  least  difference  as  to  the  cost  or  difference  of  price."*  — 
[^Nufrs  on  Polliical  Economy  by  a  Souther?!,  Planter.'\ 

*  This  point  is  well  illustrated  by  the  followinsr  bill=,  from  Hunt's  Merchant's 
Magazine,  May,  1841,  which,  it  is  there  stated,  are  made  out,  as  nearly  as  could 
be  ascertained,  according  to  th*;  prices  in  that  place,  in  the  years  specified. 
1820.  The  Town  of  Londonderry  (N.  H.),  Dr. 

To  1000  yards  of  broadcloth,  at  $4 $4,000 

CONTRA. 

By  4,000  bushels  of  apples,  at  121  cents $500 

By  1,000  barrels  of  eider,  at  $1 1,000 

By  1,000  cords  of  wood,  at  $1 1,000 

By  2,000  bushels  of  potatoes,  at  25  cents 500 

By  1,000  turkeys,  at  50  cents 500 

By  1,000  bushels  of  corn,  at  50  cents 500 

Account  balanced $4,000      $4,000 

1840.  The  Town  of  Londonderry,  Dr. 

To  1,000  yards  of  broadcloth,  at  $5  $5,000 

contra. 

By  4,000  bushels  of  apples,  at  25  cents $  1,000 

By  1,000  barrels  of  cider,  at  $2 2,000 

By  1,000  cords  of  wood,  at  $3 3,000 

By  2,000  bushels  of  p.itatoes,  at  37^  cents 750 

By  1,000  turkeys  at  $1 1,000 

By  1 ,000  bushels  of  corn   at  75  cents 750 

■ $8,500 

Balance  in  favor  of  the  town $3,500 


PROTECTIVE  DUTIES  NOT  TAXES.  379 

Is  not  this  plain  —  conclusive  —  even  if  prices  are  raised  ?  Pome 
may  say,  that  this  benefit  does  not  reach  all ;  that  it  is  partial  in  its 
distribution,  being  a  tax  to  some,  while  it  is  a  help  to  others,  which 
is  the  evil  complained  of.  With  such  minds  there  is  no  reasoning. 
The  above  description  is  precisely  the  operation  of  the  proteciive 
system,  when,  in  some  cases,  and  for  a  season,  under  a  prohibitory 
duty,  the  manufacture  of  a  protected  article  is  starting,  and  before 
home  competition  has  reduced  prices,  the  prices  are  a  little  higher. 
The  consumer,  no  matter  who  he  is,  is  benefited  in  so  many  other 
ways,  under  a  protective  system,  by  cheaj)ening  most  of  the  protected 
articles  he  has  occasion  to  use  ;  by  giving  him  employment,  if  he 
lives  on  wages  ;  or  whatever  be  his  calling  or  position,  by  making 
it  better  and  more  productive  to  himself,  in  a  prosperous  state  of 
society,  that  it  is  impossible  he  should  not  participate  in  the  general 
welfare,  so  as  to  more  than  compensate  for  this  siijiyosed  burden, 
which,  however,  is  only  imaginary.  When  the  duty  is  not  pro- 
hibitory, the  protected  article  is  never  dearer,  but  always  cheaper 
necessarily,  by  bringing  home  competition  into  the  field  against  for- 
eign. The  prices  current  in  a  foreign  market  prove  nothing  against 
this,  however  they  may  seem  to  do  so ;  for  the  moment  these  pro- 
tective duties  are  removed,  as  in  the  tariff  of  1S46,  the  foreign 
prices  rise,  just  in  proportion  to  the  prospect  of  obtaining  the 
American  market,  and  when  once  they  shall  have  gained  it  by 
breaking  down  the  American  producer,  they  w\\\  have  their  own 
prices,  which  will  be  higher  than  under  a  protective  system.  Even 
prohibitory  duties  reduce  prices  in  the  end,  in  the  case  of  articles 
in  general  demand,  if  the  system  of  protection  be  reliable,  and 
capital  dare  venture  into  the  business  to  a  sufficient  extent,  as  it 
always  will,  if  protection  is  secure. 

Such  are  the  superior  qualities  of  American  iron,  for  example* 
and  such  the  exhaustless  beds  of  its  ore,  that  nothing  is  required 
but  permanent,  secure  protection,  to  afford  every  manufactured 
iron  article  demanded  by  the  wants  of  society,  cheaper  than  they 
could  be  obtained  from  England,  or  from  any  other  quarter.  Many 
of  them  had  already  begun  to  be  cheaper  under  the  tariff  of  1S42. 
But  it  requires  time,  confidence,  and  immense  capital,  to  perfect 
all  the  manufactures  of  iron  ;  and  while  marching  to  perfection,  the 
prices  would  be  satisfactory,  beneficial  to  the  country,  and  beneficial 
to  all  parties.  If  iron  manufactures  are  discouraged,  and  languish 
in  this  country  for  want  of  protection,  England  will  take  advantage 
of  it,  and  raise  her  prices  higher  than  they  would  have  been  under 


380  PROTECTIVE  DUTIES  NOT  TAXES. 

an  American  system  of  protection,  giving  poorer  iron  as  she  must, 
and  poorer  articles.  The  moment  the  tariff  of  1846  passed,  iron 
rose  in  Englantl,  and  fell  in  the  United  States,  proving  that  the  lion 
was  roused  for  his  prey,  and  that  his  victim  could  not  resist.  If  it 
proves  that  American  prices,  in  this  case  were  higher,  it  proves 
also,  that  English  prices  will  not  keep  down.  The  level  to  which 
they  tend,  will  be  at  the  cost  of  this  country,  not  only  in  the  de- 
struction of  its  labor,  its  business,  and  its  capital,  on  an  immense 
scale  ;  not  only  in  drawing  off  its  cash  ;  but  ultimately,  in  the  aug- 
mentation of  the  prices  of  the  articles  imported.  The  same  may 
be  said  of  coal,  though  not  falling  under  the  head  of  manufactures. 
Iron  and  coal  are  among  the  greatest  and  most  important  interests 
of  the  United  States,  the  working  of  which  was  yet  in  a  state  of 
infancy,  when  the  tariff  of  1846  came  to  cripple  giant  twins,  and 
strangle  them  in  the  cradle.  They  had  begun  to  scatter  their  bles- 
sings with  a  liberal  and  profuse  hand.  No  one  felt  himself  to  be 
taxed  —  no  one  was  taxed;  none  were  poorer;  all  were  richer; 
even  though  prices  current  in  England  might  be  quoted  to  prove 
that  prices  were  lower  there.  It  proves  nothing,  except  that  Eng- 
land waits  for  another  and  better  market,  that  she  may  raise  her 
prices  on  her  victims,  which  she  will  certainly  do,  when  rivals  are 
out  of  her  path. 

The  commercial  troubles  of  England,  which  came  to  a  crisis  in 
the  latter  part  of  1847,  left  vast  quantities  of  railroad  and  other 
iron  in  the  English  market,  which  must  be  disposed  of.  Under  the 
reduction  of  duties  on  iron  by  the  American  tariff  of  1846,  it  was 
found  that  orders  on  England,  in  such  a  state  of  things,  could  be 
executed  for  the  American  market  at  prices  ruinous  to  the  Ameri- 
can manufacturer.  These  extreme  low  prices  of  English  iron 
were  the  transient  result  of  the  want  of  money  there  to  use  it  on  the 
railroads  for  which  it  was  prepared.  It  must  necessarily  be  the  same 
with  other  British  merchandise,  at  such  a  time.  But  this  does  not 
militate  against  the  above  facts  and  reasoning  ;  it  only  proves  that  sur- 
plus products,  accumulated  by  bankruptcy  and  commercial  distress, 
must  be  pushed  off  at  any  price.  By  the  ad-valorem  rule  of  the 
tariff  of  '46,  the  duty  on  iron  which  is  S18  per  ton  when  iron  is 
$60,  falls  to  $12  when  iron  falls  to  $40,  and  to  $9  when  it  comes 
down  to  $30  ;  so  that  protection,  on  this  principle,  is  greatest 
when  it  is  least  needed,  and  least  when  it  is  most  needed. 


A    RESCUE    FROM    FOREIGN    TAXATION.  381 


CHAPTER    XXIV. 

AN    AMERICAN    PROTECTIVE    SYSTEM    A   RESCUE    FROM    FOREIGN 

TAXATION. 

The  Metliod  and  Rule  of  this  Argument,  as  laid  down  by  a  Public  Docnment  and  Joshua 
Gee. —  A  Showing,  from  the  Piinciples  of  (liis  Kule,  and  by  Public  Documents,  of  the 
foreign  Taxation  which  the  People  of  the  United  States  have  been  and  are  still  pub- 
jected  to — Adam  Sinih's  and  M  Culloch's  Evidence  on  tiiis  Point — Taxes  of  foreign 
Naiions,  of  whom  we  purchase,  enter  into  the  Piices  of  their  Products  to  us. — The  Prin- 
ciples (  f  the  Tariff  of  1846,- as  they  bear  on  this  Point — Returns  of  British  Commerce 
as  com|iared  with  those  of  the  United  States. — Tlie  Aggiegate  of  foreign  Taxes  paid 
by  the  United  States  since  1791. — A  Protective  System  the  sure  and  only  Way  of  Kescae 
from  foreign  Taxation. 

Having  shown  in  the  preceding  chapter,  that  protective  duties 
are  not  taxes,  but  quite  the  contrary,  it  is  also  necessarily  proved, 
by  the  same  argument,  that  Free  Trade  is  itself  a  tax,  in  proportion 
as  Protection  reduces  the  prices  of  manufactured  articles;  in  pro- 
portion as  it  raises  and  sustains  the  prices  of  labor  ;  in  proportion 
as  it  raises  and  sustains  the  prices  of  agricultural  products  and 
other  raw  materials  of  home  production  ;  and  in  proportion  as  a 
protective  system  tends  to  promote  and  secure  all  the  great  and 
minor  interests  of  the  country,  and  the  interests  of  all  parties  and 
persons  therein,  as  shown  in  the  preceding  chapter,  and  elsewhere. 
But  these  great  positive  benefits  of  Protection  are  not  what  we  now 
propose  to  notice,  although  their  effect  is  a  rescue  from  taxation,  in 
all  that  the  absence  of  Protection  operates  as  a  burden.  Our  de- 
sign now  is  rather  to  consider  how  a  well-adjusted  protective  sys- 
tem rescues  us  from  a  stupendous  burden  of  foreign  taxation. 

'J'he  following  extract  from  a  public  document,  house  of  repre- 
sentatives, No.  290,  3d  session,  27th  Congress,  pp.  500  and  501, 
will  indicate  both  the  material  and  method  of  our  present  line  of 
argument :  — 

"  England  levies  no  direct  taxes  upon  her  colonies,  or  rarely  is 
it  done.  But  by  ivdirrct  /axes,  they  give  four  Jift /is  of  their  pro- 
ductive wealth  to  the  mother-coimtry.  It  was  that  support  which 
she  derived  from  the  thirteen  [North  American]  colonies,  and  it 
was  for  that  alone  she  resisted  their  independence.  She  desired  to 
produce,  and  that  they  should  be  forced  to  consume  ;  and  of  all  that 


382  AN    AMEIUCAN    PROTECTIVE    SYSTEM 

they  consumed  [of  imports  from  the  mother-country],  at  \eRSt  four 
fifths  went  into  tlie  national  treasury  at  home,  after  supporting-  her 
farmers  and  mechanics.  .  .  It  is  generally  alleged,  that  a  man  pays 
15  shillinfs  for  the  use  of  government,  out  of  every  20  shillings  he 
spends  in  England.  Some  have  stated  the  puhlic  tax  at  17  shil- 
linf^s  in  the  pound.  Let  us  take  one  instance  in  the  article  of  beer. 
The  land  pays  a  tax  ;  the  barley,  when  malted,  pays  an  excise  of 
6  pence  per  bushel ;  hops  pay  one  penny  a  pound  ;  the  beer,  when 
brewed,  pays  an  excise  in  some  cases  greater  than  the  original 
value  ;  all  the  persons  who  labor  in  the  premises,  contribute  to  the 
national  revenue,  by  their  sundry  consumptions,  to  the  amount  of 
three  fiviths  of  the  whole  price  of  their  labor.  It  follows,  then, 
that  the  people  of  this  country  [the  United  States]  contribute  in 
like  pro})ortion  to  the  support  of  foreign  governments,  upon  all  that 
they  purchase.  In  ]b36,  we  imported  more  than  $70,000,000 
worth  of  foreign  articlesy'/ve  ffch/ft/.  The  effect  was,  that  they  who 
purchased  [consumed]  these  articles,  paid  not  one  cent  to  the  sup- 
port of  our  own  government,  while  at  \eHst  four  fifths  [$5G,000,000] 
of  that  amount  went  into  the  treasuries  of  foreign  governments,  to 
support  kings  on  their  thrones,  parliaments  that  make  laws  prohib- 
iting our  productions,  and  foreign  armies  and  navies  !" 

'i'he  principle  of  this  rule  is  correct;  but  there  is  an  error  in 
supposing  that  the  ^^ four  fifths'''  taxation  of  the  colonies  all  goes 
into  the  public  exchequer.  It  is  divided  between  the  government 
and  those  domestic  parties  who  trade  with  the  colonies.  The  gov- 
ernment gels  the  smallest  part  directly  ;  but  indirectly,  the  wealth 
derived  by  these  other  parties  from  this  source,  is  an  essential  part 
of  the  basis  of  the  government.  It  matters  not  to  the  colonies, 
whether  the  taxation  be  direct  through  the  government,  or  indirect 
through  its  commercial  policy.      It  is  taxation. 

The  specification  here  made  of  the  different  forms  of  tax  on  beer, 
is  a  food  deal  short  of  the  truth.  In  MCulloch's  statistics  of  the 
British  empire,  will  be  found  nineteen  specifications  of  duty  and 
excise  on  this  article,  and  the  whole  amount  of  revenue  raised  from 
taxes  on  beer  in  1834,  not  including  the  land  tax,  was  over  six 
millions  sterling,  or  twenty-nine  millions  of  dollars. 

The  above  citation  from  a  congressional  document,  is  corrobo- 
rated by  Joshua  Cee,  as  follows  :  "  If  we  examine  into  the  circum- 
stances of  the  inhabitants  of  our  plantations  [the  American  colonies] 
and  our  own,  it  will  appear,  that  not  one  fourth  jxnt  of  their  own 
products  redounds  to  their  own  profit ;  for  out  of  all  that  they  bring 


A  RESCUE  FROM  FOREIGN  TAXATION.  383 

here,  they  only  carry  back  clothins;  and  other  accommodations  for 
their  families,  all  of  which  is  of  the  merchandise  and  manufacture 
of  this  k'ngdom."  Of  course,  the  other  three  foiirihs,  enterin<,r  into 
the  prices  of  these  articles,  were  absorbed  by  the  profits  of  British 
trade  in  the  premises,  and  by  the  taxes  of  the  domestic  empire, 
and  the  colonists  were  compelled  to  pay  four  to  one  of  the  actual 
costs  ;  or,  as  Gee  says,  more  than  four  to  one. 

In  the  analysis  of  these  statements,  we  have  the  picture  of  the 
manner  in  which  the  two  thirds  of  the  value  of  European  labor, 
usurped  as  shown  elsewhere,  is  absorbed  by  the  governments  and 
the  superior  classes  of  society  ;  and  beyond  this,  we  are  also  com- 
pelled to  observe,  that  the  necessaries  of  life,  purchased  with  the 
remaining  third,  called  wages,  to  support  the  existence  of  the  la- 
borers, is  burdened  with  that  very  system  of  taxation  represented 
in  the  above  extracts.  "  AH  the  persons  who  labor  in  the  premi- 
ses, contribute  to  the  national  revenue,  by  their  sundry  consump- 
tions, to  the  amount  of  three  fourths  of  the  whole  price  of  their 
labor."  The  taxes,  whatever  they  are,  enter  into  the  prices,  even 
of  the  articles  which  tlie  laborers  consume,  after  they  are  deprived 
of  two  thirds  of  their  fair  reward. 

Now  it  must  be  seen,  that  this  stU|)endous  system  of  taxation 
enters  into  the  prices,  and  composes  a  part  of  the  prices  of  all  the 
articles  imported  from  Euro|)e  to  this  country,  and  is  borne  by  the 
American  consumers.  That  is  to  say,  these  taxes  are  paid  by  us, 
to  the  extent  of  our  consumption  of  these  foreign  products,  and  to 
the  amount  of  the  fractional  parts  of  the  prices  which  are  composed 
of  the  taxes,  they  being  the  largest  part.  The  statement  in  the  first 
of  the  above  extracts,  is,  that  we  paid  $56,000,000  of  these  taxes 
in  1S36,  as  we  understand  and  have  interpreted  the  rule  in  brackets, 
in  that  place.  This  result  is  obtained,  first,  by  deducting  the  re- 
exports of  that  year  from  the  free  imports  —  which,  according  to 
the  official  tables  of  1845,  were  upward  of  $92,000,000  —  and 
then  taking  four  fifths  of  the  remainder.  But  nothing  can  be  more 
evident  than  that  we  are  taxed  for  imports  paying  duty,  as  well  as 
for  those  free  of  duly.  The  principle  of  the  rule,  therefore,  laid 
down  in  the  public  document,  above  cited,  would  simply  require, 
first,  the  deduction  of  re-exports  from  the  sum  of  imports,  and  four 
fifths  of  the  remainder  is  the  amount  of  taxes  we  pay  the  nations 
from  which  the  imports  are  derived.  Inasmuch  as  we  have  proved 
that  protective  duties  do  not  augment,  but  reduce,  the  prices  of 
manufactured  articles  ;  and   if  it  be  supposed  that  the  reduction 


384  AN    AMERICAN    PROTECTIVE    SYSTEM. 

of  prices  on  protected  articles  be  equal  to  the  augmentation  of 
prices  on  those  not  protected,  in  consequence  of  duties,  then  the 
imports  paying  and  not  paying  duty,  occupy  precisely  the  same 
position  under  this  rule.  In  any  case,  the  difference  between  the 
reduction  of  prices  on  protected  articles,  and  the  augmentation  of 
prices  by  duties  on  the  unprotected,  if  there  b§  any,  and  so  far  as 
there  is,  is  too  trifling  to  be  worthy  of  consideration  here. 

Applying  this  rule,  as  here  explained,  to  the  official  tables  of 
1845  (Ex.  Doc.  No.  6,  pp.  942  and  943),  omitting  fractions  of 
millions,  and  counting  a  million  when  the  fraction  is  over  500,000, 
we  come  to  the  following  result : — 

That,  for  the  importsof  1821,  we  paid  foreign  taxes  to  the  amount  of  $33,000,000 

For  those  of  1822 49,000,000 

For  those  of  1823 40,000,000 

For  those  of  1824 45,000,000 

For  those  of  1825 50,000,000 

For  those  of  1826 48.000,000 

For  those  of  1827 45,000,000 

For  those  of  1828 54,000,000 

For  Ihose  of  1829 46,000,000 

For  those  of  1830 45,000,000 

For  those  of  183 1 66,000,000 

For  those  of  1832 62,000,000 

For  those  of  1833 70,000,000 

For  those  of  J 834 . . .' 83,000,000 

For  those  of  1835 103,000,000 

For  those  of  1836 134,000,000 

For  those  of  1837 96,000,000 

For  those  of  1838 82,000,000 

For  those  of  1839 11 6,000,000 

For  those  of  1 840 7 1,000,000 

For  those  ofl841 90,000,000 

For  those  of  1842 70,000.000 

For  those  of  1 843 46,000,000 

For  those  of  1844 77,000,000 

For  those  of  1845 81,000,000 

It  is  not  meant  that  the  whole  amount  of  this  showing  has  been 
a  •positive  tax  to  the  United  States.  How  far  it  was  so,  will  appear 
by-and-by. 

These  results,  it  will  be  observed,  are  obtained  by  the  rule  of 
taxation  alleged  in  the  document  above  cited,  viz.,  that  an  average 
oi  four  f fill  a  of  the  prices  of  these  imports,  before  they  start  for 
our  market,  is  composed  of  taxes,  in  one  form  or  another.  But 
suppose  it  is  not  more  than  three  fomilm,  which  is  the  proportion 
specified  by  Joshua  Gee,  as  above  cited,  who  is  a  British  authority 
that  had  no  motive  for  stating  it  too  large,  but  the  contrary  —  then 


A    RESCUE    FROM    FOREIGN    TAXATION.  385 

the  proper  result  will  be  obtained  by  taking  the  total  of  the  re- 
exports for  the  above-namt-d  years,  from  the  total  of  imports,  and 
three  fourths  of  the  remainder  will  be  the  required  items,  itislead 
of  four  fifths,  as  they  now  stand  above. 

Joshua  Gee's  rule  of  ^'- 1  line  four  tlm^^  is  quite  strong  enouirh  for 
our  purpose,  and  is  perhaps  as  near  the  truth  as  the  rule  of  '■four 
JiJ'ihs,''^  cited  from  the  public  document.  Without  being  at  the 
trouble,  tiierefore,  of  going  over  these  operations  of  figures  by  the 
tables  again,  to  find  each  item  by  a  separate  process  —  no  small 
task,  as  will  be  seen  —  let  them  all  be  sup|)osed  reduced,  or  actu- 
ally reduced,  if  any  choose  the  latter,  in  a  proportion  as  from  four 
fifths  to  three  fourths  of  their  several  integral  sums,  and  let  these 
be  the  results  severally,  instead  of  those  above  obtained  by  the  rule 
of  four  fifths.  But  the  principle  and  result  of  the  argument  will  be 
the  same. 

But  in  Fisher's  National  Magazine  for  August,  1845,  is  an  ab- 
stract from  the  ofiicial  records  of  the  treasury  department,  exiiib- 
iting  a  list  of  imports  into  the  United  States,  from  1830  to  1844, 
inclusive,  fifteen  years,  not  enumerated  in  the  tables  above  cited, 
amounting  to  an  aggregate  of  $15  1 ,259,5(55,  or  an  average  of  up- 
ward of  ten  millions  a  year,  six  tenths  of  which  came  in  free  of 
duty.  But  whetlier  they  paid  duty  or  not,  is  no  matter  in  the 
present  case.  This  official  proof  of  such  a  large  amount  of  im- 
ports, not  enumerated  or  presented  in  the  usual  official  tables, 
occurring  without  interruption  for  fifteen  years,  when  t!ie  treasiny 
department  may  be  supposed  to  have  been  under  better  regulations 
than  formerly,  and  more  reliable  in  such  accounts,  is  presumptive 
evidence  that  at  least  an  equal,  probably  a  greater,  proportion  of 
the  imports  previous  to  183U,  back  to  1791,  as  far  as  the  official 
tables  go,  is  also  wanting  in  those  tables.  To  balance  this  defect 
of  the  tables,  therefore,  thus  established  beyond  any  reasonable 
doubt,  we  have  supposed  that  the  above  results,  showing  the 
amount  of  foreign  taxation  which  enters  into  the  cost  of  our  im- 
ports, and  obtained  from  a  calculation  of  four  fifths  instead  of  ihiee 
fourths,  are  not  probably  too  large,  and  may  therefore  fairly  stand 
as  they  are,  as  not  being  materially,  if  at  all,  in  excess  of  Joshua 
Gee's  rule,  viz.,  tluee,  fourihs  instead  oifourjij'ihx. 

It  ought,  perha])s,  to  be  held  quite  unnecessary  to  attem|)t  to 
show  that  the  taxes  of  a  nation,  whence  we  import  for  consump- 
tion, enter  into  the  prices  of  the  articles,  and  are  paid  by  the  con- 
sumers.     But  in  a  work  of  this  kind,  every  point  made  requires 

25 


386  AN    AMERICAN    PROTECTIVE    SYSTEM 

to  be  fortified.  Adam  Smith  has  some  good  reasoning  on  this 
subject,  which  it  ma}-  be  well  to  cite  here ;  "  All  taxes,  and  all  the 
revenue  which  is  founded  upon  them  —  ^11  s;ilaries,  pensions,  and 
annuities,  of  every  kind  —  are  ultimately  derived  from  some  one 
or  oiher  of  these  three  original  sources  of  revenue  [rent,  profit,  and 
wages],  and  are  paid,  either  immediately  or  mediately,  from  the 
wages  of  labor,  the  profits  of  stock,  or  the  rent  of  land."  — "  The 
real  value  of  all  the  different  component  parts  of  price,  it  must  be 
observed,  is  measured  by  the  quantity  of  labor  which  they  can, 
each  of  them,  produce  or  command.  Labor  measures  the  value 
not  only  of  that  part  of  price  which  resolves  itself  into  labor,  but 
of  that  which  resolves  itself  into  rent,  and  of  that  which  resolves 
itself  into  profit.  In  every  society,  the  price  of  every  comnmdity 
resolves  itself  into  some  one  or  other  of  all  these  three  parts;  and 
in  every  improved  society,  all  the  three  enter,  more  or  less,  aa 
component  parts,  into  the  price  of  far  the  greater  part  of  commodi- 
ties. In  tlie  price  of  corn,  for  example,  one  part  pays  the  rent  of 
the  landlord,  another  pays  the  wages  or  maintenance  of  the  labor- 
ers and  laboring  cattle  employed  in  producing  it,  and  the  third 
pays  the  profit  of  the  farmer.  These  three  parts  seem,  either  im- 
mediately or  ultimately,  to  make  up  the  whole  price  of  corn.  .  . 
In  tiie  price  of  Hour  or  meal,  we  must  add  to  the  price  of  corn,  the 
profits  of  the  miller,  and  the  wages  of  his  servants;  in  the  price  of 
bread,  tlie  profits  of  the  baker,  and  the  wages  of  his  servants  ;  and 
in  the  prices  of  both,  the  labor  of  transporting  the  corn  from  the 
house  of  the  farmer  to  that  of  the  miller,  and  from  that  of  the  mil- 
ler to  that  of  the  baker,  together  with  tl)e  profits  of  those  who  ad- 
vance the  wages  of  the  labor.  The  price  of  flax  resolves  itself 
into  the  same  three  parts  as  that  of  corn.  In  the  price  of  linen 
we  must  add  to  this  price  the  wages  of  the  flax-dresser,  of  the 
spinner,  of  the  weaver,  of  the  bleacher,  &c.,  together  witli  the 
profits  of  their  respective  employers.  As  any  particular  com- 
modity comes  to  be  more  manufactured,  that  part  of  the  price 
which  resolves  itself  into  wages  and  profit,  comes  to  be  greater  in 
proportion  to  that  which  resolves  itself  into  rent.  In  the  progress 
of  the  manufacture,  not  only  the  number  of  the  profits  incre.ise,  but 
every  subsequent  profit  is  greater  than  the  foregoing,  because  the 
capital  from  which  it  is  derived  must  always  be  greater." 

The  above  analysis  is  sufficient  to  disclose  the  priniij)le  on 
which  prices  are  composed,  though  it  comprehends  only  a  part  of 
those  costs  wliich  enter  into  prices.     It  will  be  observed  that  rent 


A    RESCUE    FROM    FORKIG.V    TAXATION.  387 

goes  into  prices;  and  the  rental  of  England  proper,  for  1814-'15, 
according  to  M'Culloch,  was  ^£32,502, 824,  or  about  $156,000,000 ; 
the  profits  of  the  farmers  in  England,  under  the  property-tax  act, 
were  rated  at  three  fourths  of  the  rent,  wl)ich  would  be  $126,- 
000,(100;  poor-rates  of  England  proper.  .£7,000,000,  or  $33,- 
000,000  ;  church-rates,  do.,  ^9,000,000,  or  $43,000,000  ;  annual 
parliamentary  budget,  £50,000,000,  or  $242,000,000  ;  a  great  va- 
riety of  municipal  taxes,  imknown  ;  profits  of  manufactures  ;  &c., 
&c.  :  all  these,  and  many  other  nameless  burdens  of  the  English 
people,  enter  into  and  compose  parts  of  the  prices  of  their  prod- 
ucts, whatever  they  are,  and  are  paid  by  the  consumers. 

As  to  the  facts,  that  the  systems  of  taxation  of  the  different  na- 
tions with  which  we  tnide, so  far  as  the  taxes  enter  into  the  prices 
of  the  articles  to  us,  are  unequal,  that  difference  can  not  be  of  any 
account  in  the  present  argument,  imle-^s  it  can  be  shown  that  the 
aggregate  of  our  imports  is  affected  thereby  as  to  the  point  now 
under  consideration  ;  and  even  if  it  could,  still  the  fact  would  be 
of  very  little  account,  and  not  worth  noticing  in  the  grand  result. 
As  the  major  part  of  our  imports  come  from  Europe,  we  have  gen- 
erally taken  society  and  the  average  price  of  labor  there  as  a 
standard  of  our  calculations  ;  and  as  labor  is  generally  better  paid 
in  Europe,  and  as  the  ."systems  of  taxation  are  less  oppressive  there 
than  in  other  parts  from  which  our  imports  conie,  a  more  exact 
rule,  derived  from  a  consideration  of  such  facts,  would  only  give 
additional  force  to  our  arguinent. 

The  result  of  the  whole  is,  that  the  taxes  of  foreign  governments 
or  societies,  from  under  whose  jurisdiction  we  derive  our  imports, 
enter  into  the  prices  to  us,  and  that  we  pay  them,  so  far  as  we  con- 
sume the  articles,  and  do  not  re-export  them  ;  and  we  have  already 
given  reasons  to  show  why  the  respective  amounts  of  taxation 
above  given  for  each  several  year,  from  1821  to  1845,  as  paid  by 
us  to  foreign  powers,  by  the  consumption  of  their  products,  can 
not  be  very  far  from  tlie  truth.  The  question  remains  as  to  how 
we  pay  these  taxes,  and  as  to  Jioivjhr  they  are  a  burden  ? 

To  which  it  may  be  answered,  first,  that,  so  far  as  we  import 
what  we  want,  and  what  we  could  not,  by  protection  or  otherwise, 
ourselves  produce,  as  cheap  or  cheaper  ;  and  so  far  as  we  pay  in 
our  own  products  which  we  do  not  want,  without  being  brought 
in  debt,  when  the  entire  of  our  foreign  trade  is  brought  into  the 
account,  and  are  not  forced  to  part  with  our  cash  to  settle  balances ; 
thus  far  it  is  of  no  consequence  to  us,  in  a  commercial  point  of 


388  AN    AMERICAN    PROTECTIVE    SYSTEM 

view,  wlietlier,  in  such  a  trade,  we  pay  ten,  or  twenty,  or  a  hun- 
dred millions  of  foreign  taxes  a  year  ;  or  whether  we  pay  none  at 
all,  hecause  no  taxes  exist  in  those  quarters,  if  the  case  were  so. 
The  amount  of  foreign  taxes,  therefore,  as  specified  above,  which 
we  really  pay,  more  or  less,  is  not  so  startling  as,  at  first  sight, 
might  be  supposed  ;  for  it  must  have  been  observed,  that  the  sums 
are  very  great.  We  may  commiserate  those  conditions  of  society, 
as  undoubtedly  we  do,  or  ought  to  do,  where  labor  is  forced  to 
toil  on  and  drag  out  a  miserable  existence,  on  wages  which  will 
only  procure  the  scantiest  necessaries  of  life,  and  three  fourths  of 
the  price  of  those  necessaries  being  itself  made  up  of  taxes  ;  we 
may  be  deeply  sensible  of  the  injustice  and  wickedness  of  such  a 
state  of  society  ;  nevertheless,  in  a  commercial  point  of  view,  it 
makes  no  difference  with  us  at  whose  expense  or  at  whose  benefit 
we  obtain  the  supply  of  our  wants,  by  an  exchange  which  is  not 
only  agreeable,  but  perhaps  in  some  degree  profitable.  It  matters 
not  whether  the  prices  are  partly  composed  of  foreign  taxes  or  not, 
though,  in  the  exchange,  we  pay  those  taxes,  so  long  as  they  are 
not  taxes  to  us.  The  operation,  so  far  as  we  are  concerned,  might 
be  precisely  the  same,  if  society,  from  under  whose  jurisdiction  we 
derive  our  imports,  were  composed  in  the  best  and  most  equitable 
manner,  if  labor  enjoyed  its  fair  reward,  and  if  there  were  no  un- 
just system  of  taxation  there  ;  provided,  however,  it  be  also  sup- 
posed that  lliis  unjust  society  should  not  or  could  not  take  advan- 
tage of  the  parties  with  which  it  trades  —  a  thing  hardly  to  be 
expected.  —  It  can  and  does  charge  exorbitant  prices,  wherever  it 
enjoys  a  monopoly  of  the  market.  We  are,  of  course,  obliged  to 
submit  to  these  prices,  so  long  as  we  can  not  ourselves  produce 
the  same  things  ;  yet  the  trade,  under  all  the  unjust  exactions,  may 
be  desirable,  and  even  profitable. 

But,  secondly,  these  foreign  taxes  begin  to  affect  us  as  soon, 
and  so  far  as,  by  a  system  of  protection,  we  can  not  only  produce 
the  same  things,  but  produce  them  at  lower  rates,  if,  for  want  of 
protection,  we  are  obliged  to  depend  on  the  supply  of  these  wants 
from  abroad.  It  has  been  proved  that  protection  cheapens  manu- 
factured articles.  But  even  if  it  did  not,  and  only  afforded  them 
at  the  same  rates,  still  we  should  be  unnecessarily  subject  to  this 
enormous  system  of  foreign  taxation,  the  whole  of  which  would  be 
so  much  loss  to  the  country.  For  example,  the  secretary  of  the 
treasury  estimated,  in  his  project  for  the  tariff  of  1846,  that,  by  a 
reduction  of  duties  to  the  rates  he  proposed,  there  would  be  an 


A  RESCUE  FROM  FOREIGN  TAXATION.         389 

additional  revenue,  on  the  imports  of  boots  and  shoes,  of  $45,000  ; 
on  ready-made  clotliing,  $200,000  ;  on  the  work  of  blacksmiths, 
$200,000;  on  hats,  $1  1 0,000  ;  on  leather,  $100,000;  on  iron, 
$1,185,000  ;  on  coal,  $5,150,000  ;  on  glass  ware,  $100,000;  on 
paper,  $150,000;  <m  hemp,  cordage,  &c.,  $250,000  ;  on  pins, 
$50,000;  on  woollen  fabrics,  $2,000,000;  on  salt,  $1,000,000; 
on  sugar,  $630,000  ;  on  wool,  $200,000  ;  on  potatoes,  $150,000  ; 
&c.,  &c.  —  The  sum  of  the  above  items  is  $  1 1,545,000,  proposed 
to  be  raised  by  an  average  duty  of  27  per  cent,  ad  valorem,  which 
would  require  a  basis  of  more  than  forty  millions  of  imports.  With 
the  exception  of  the  blacksmiths'  work,  the  amount  of  imports  of 
the  same  articles,  under  the  tariff  of  1842,  according  to  the  report 
of  the  secretary,  was  a  little  over  $24,000,000,  under  an  average 
duty  of  59  per  cent.  Consequently,  to  raise  an  equal  amount  of 
revenue  from  these  articles,  with  an  average  duty  of  27  per  cent., 
the  imports  must  be  doubled  ;  so  that  the  augmentation  of  imports 
of  these  fifteen  or  sixteen  articles,  which  would  be  required  to  re- 
alize the  secretary's  project  for  the  tariff  of  1840  —  not  to  spenk  of 
the  remainder  of  the  list  subject  to  a  like  rule  and  rate  of  duty  — 
is  from  sixty  to  seventy  millions  of  dollars.  Consequently,  as  the 
tariff  of  1846  was  not  based  upon  the  increased  wants  of  the  coun- 
try, but  upon  the  transfer  of  production  from  the  United  States  to 
foreign  parts,  it  follows,  that,  to  be  realized,  there  must  be  a  check 
of  production  at  home  by  an  amount  equal  to  the  augmentation  of 
imports  from  abroad  ;  that  is,  a  suppression  of  home  production  of 
from  sixty  to  seventy  millions  of  dollars.  It  is  not  a  question 
whether  we  are  capable  of  producing  all  and  each  of  these  articles, 
under  a  system  of  protection  ;  for  we  were  in  the  habit  of  produ- 
cing them  under  the  tariff  of  1842  :  nor  whether  we  can  produce 
them  as  cheap  ;  for  that  also  is  decided  in  the  affirmative.  It  there- 
fore follows,  that,  by  transferring  the  production  of  sixty  or  seventy 
millions  of  dollars'  supply  of  our  wants  from  home  to  other  coun- 
tries, we  not  only  injure  our  own  people  by  depriving  them  of  this 
amount  of  business,  but  we  subject  ourselves  to  a  system  of  foreign 
taxation  for  at  least  three  foiunhs  of  this  amount ;  that  is,  for  some 
forty  to  fifty  millions  of  dollars.  It  is  in  such  a  case,  when  we  can 
produce  what  we  want — much  more  when  we  have  been  in  the 
habit  of  producing  it — that  we  begin  to  feel,  can  not  avoid  feeling, 
the  pressure,  the  overpowering  weight  of  this  foreign  taxation.  It 
is  then  that  it  becomes  a  positive,  real,  palpable  tax,  without  dis- 
guise, and  with  all  its  irresistible  effect. 


090  AN    AMERICAN    PROTECTIVE    SYSTEM 

iSo  long  as  we  can  not  supply  our  own  wants,  and  have  where- 
withal to  purchase,  and  do  not  buy  beyond  our  means  of  paying, 
we  are  accommodated,  at  the  same  time  that  we  pay  these  foreign 
taxes;  for,  in  any  case,  we  p;iy  them  for  all  we  consume  of  foreign 
products.  But  in  all  that  we  are  capable  of  su()plying  our  own 
wants,  under  a  system  of  protection,  and  yet,  for  lack  of  protection, 
are  compelled  to  depend  on  foreign  producers,  nearly  the  whole 
amount  of  such  expenditures  is  not  only  absorbed  in  systems  of 
foreign  taxation,  but  it  is  a  positive  tax  to  the  country,  while  no 
party  or  person  in  it  is  benefited.  Many,  it  may  be  thousands,  or 
tens  of  thousands,  are  of  course  injured  —  deprived  of  their  rights, 
and  in  a  greater  or  less  degree  impoverished  —  inevitably  incurring 
a  negative  loss,  by  not  being  able  to  acquire  what  they  otherwise 
could,  and  are  entitled  to. 

But  we  have  not  even  yet  arrived  at  the  points  of  this  argument 
which  are  of  the  greatest  force,  and  which  are  most  strikingly  illus- 
trative of  the  crreat  truth  which  we  are  now  endeavoring  to  make 
apparent.  None,  it  is  believed,  can  fail  to  appreciate  the  demon- 
stration—  for  such  is  the  character  of  the  proof — presented  in  the 
above  examination  of  the  secretary's  project  for  the  tariff  of  1S46. 
It  can  not  but  be  seen  that  the  plan  (here  laid  out  for  increased 
importations  is  not  only  identical  with  a  scheme  of  foreign  taxation, 
to  a  very  great  amount,  even  for  twenty  millions  of  people,  but  that 
it  is,  at  the  same  time,  a  plan  for  the  suppression  of  so  much  Amer- 
ican industry  and  labor,  which  is  an  aggravation  of  the  case.  But, 
in  order  to  have  a  more  full  appreciation  of  the  natural  and  neces- 
sary results  of  this  |)lan,  it  will  be  useful  to  recur  to  our  history  of 
imports  and  exports  from  the  earliest  date,  as  well  as  to  the  evi- 
dence displayed  in  the  foregoing  statements  of  the  foreign  taxes 
which  this  country  paid  from  1821  to  1845  ;  though  it  is  admitted 
that  they  were  not  all  necessarily,  or  of  course,  a  burden  ;  and 
that,  for  a  portion  of  that  period,  and  for  a  part  of  this  amount 
through  the  whole,  they  were  an  accommodation  ;  that  is,  so  far  as 
the  imports  supplied  wants  which  we  could  not  ourselves  supply, 
and  so  far  as  we  were  protected  against  excessive  imporiationa 
which  we  were  not  able  to  pay  for,  and  the  burden  of  which  broke 
down  the  country. 

The  history  of  our  imports  and  exports,  as  furnished  by  the  pub- 
lic (treasury)  documents,  does  not  go  farther  back  than  1791,  which 
is  sufficient,  and  is  very  instructive  on  this  j)oint  —  instructive  in 
itself,  in  the  contrast  of  its  columns  of  imports  and  exports,  and  in 


A    RESCUE    FROM    FOREIGN    TAXATION.  391 

its  exliibition  of  the  fluctuations  of  excess,  one  over  the  other;  and 
still  more  instructive  as  compared  with  the  liistory  of  British  im- 
ports and  ex|)orts.  It  appears  from  Anderson's  Commercial  His- 
tory of  Great  Britain,  that  from  1700  to  1787,  there  was  not  a 
single  year  when  the  exports  did  not  exceed  the  imports  ;  and  that 
ihe  aggregate  excess  or  balance  of  exports  over  imports,  for  this 
period,  was  ^289,321,713  ;  or  $1,400,317,090.  Since  1787,  the 
balance  has  also  been  uniformly  on  the  side  of  exports,  but  greatly 
in  excess  of  ihe  former  period,  and  that  excess  constantly  augjnent- 
ing.  In  a  report  of  the  American  Institute,  New  York,  1844,  on 
*'  the  commercial  intercourse  of  the  United  States  and  Great  Brit- 
ain," they  say  : — 

"  The  total  value  of  exports  and   imports  of  Great  Britain  and 
Ireland  for  three  successive  years  was  as  follows ; — 

Year.  Exports.  Importa. 

1839 £  no,  1 98,7 16 i;62,00-l,000 

1840 116,479,679 67,432,964 

1841 116,903,668 64,377,962 


£343,582,061  £193,814,926 

Balance  in  favor  of  Great  Britain,  ,£149,767,136,  or  an  annual 
average  of  ,£49,822,378,  equal  to  $237,2-27,414."  This  statement 
is  manifestly  too  large,  arising,  probably,  by  taking  the  valuation 
established  in  1694,  instead  of  finding  the  "declared  value." 

We  find  in  M.  Say  the  following  passage  on  this  point:  "  The 
returns  of  British  commerce,  from  the  commencement  of  the  eish- 
teenth  century  down  to  the  establishment  of  the  existing  paper- 
money  of  that  nation  [the  bank-of-England  suspension,  in  1797], 
show  a  regular  annual  excess,  more  or  less,  received  by  Great 
Britain,  in  the  shape  of  specie,  amounting  altogether  to  the  enor- 
mous total  of  £347,000,000  sterling." 

Tlie  commercial  history  of  the  United  States,  as  appears  from 
our  public  (treasury)  documents,  is  a  remarkable  contrast  even  to 
Anderson's  tables.  From  1791  to  1845,  inclusive,  there  was  an 
excess  of  exports  over  imports  only  for  eleven  years  of  this  period, 
the  aggregate  of  which  was  $79,545,660  ;  whereas,  the  aggregate 
excess  of  imports  over  exports,  for  the  other  forty-four  years,  was 
$798,505,146  ;  making  an  aggregate  balance  of  imports  over  ex- 
ports, for  the  whole  fifty-five  years,  of  $718,959,486. 

It  is  not  less  instructive  to  observe  when  and  from  what  apparent 
causes  the  balances  in  favor  of  the  country  have  occurred,  small  as 
they  are,  compared  with  the  other  side.     The  first  favorable  balance 


392  AN    AMERICAN    PROTECTIVE    SYSTEM 

we  find,  is  one  of  a  little  less  than  eight  millions,  in  1811,  the  year 
before  the  war.  It  was  after  a  protracted  period  of  unfavorable  bal- 
ances, running  back  to  1791,  the  first  year  of  any  official  statements 
on  the  subject ;  of  course  running  back  into  the  years  of  the  con- 
federation, worse  yet;  and  into  the  colonial  history,  the  worst  of 
all.  For  the  six  years  immediately  preceding  1811,  the  amount 
of  balance  against  the  country  was  upward  of  $140,000,000.  The 
country  at  this  time  was,  therefore,  much  exhausted,  poor,  without 
credit,  and  the  small  excess  of  exports  over  imports,  in  1811,  was 
the  natural  result  of  the  obligation,  and  of  an  effort,  to  make  remit- 
tances for  foreign  demands.  The  next  (second)  excess  of  exports 
over  imports  was  a  little  less  than  $6,000,000,  in  1813,  in  the 
midst  of  the  war,  when  our  imports  were  only  twenty-two  millions, 
reduced  in  1814  to  thirteen  millions.  The  major  part  of  our  com- 
merce, as  may  be  supposed,  was  then  carried  on  in  neutral  bottoms; 
and  the  excess  of  exports  in  1813  was  more  than  counterbalanced 
in  1814,  when  the  exports  were  only  seven  millions  against  thir- 
teen millions  of  imports.  After  a  lapse  of  seven  years  from  this 
time — years  of  an  immense  excess  of  imports,  amounting  in  the 
ao-o-regate  to  upward  of  $190,000,000  —  there  was  another  small 
excess  of  exports  in  1821,  a  little  in  excess  of  two  millions  of  dol- 
lars ;  another  in  1825,  of  three  millions;  another  in  1827,  a  little 
less  than  three  millions;  and  another  in  1830,  also  less  than  three 
millions.  These,  of  course,  were  but  of  sn)all  amount  against  the 
large  excess  of  imports  running  along  the  same  period  of  about  ten 
years.  From  1830  to  1840,  the  aggregate  excess  of  imports  over 
exports,  was  $224,000,000,  which  had  so  much  impoverished  the 
country,  and  run  it  so  much  in  debt,  that  it  had  no  credit  abroad 
to  buy  with.  As  a  natural  consequence,  the  exports  in  1840  pre- 
sent a  larger  excess  over  imports,  than  in  any  other  year  of  our 
history,  being  a  little  less  than  $25,000,000,  half  of  which,  at  least, 
was  required  to  pay  interest  on  foreign  debts,  contracted  in  the  nine 
previous  years.  In  1841,  there  was  another  excess  of  imports, 
$6,000,000.  But  from  that  time,  under  the  tariff  of  1842,  till  it 
was  repealed  in  1846,  the  balances  were  all,  and  uninterruptedly, 
in  favor  of  the  country,  amounting,  for  the  years  1842  to  1845,  in- 
clusive, to  upward  of  $29,000,000. 

The  heaviest  balances  of  imports  against  the  country,  are  found, 
either  at  a  period  of  the  disturbance  of  our  foreign  relations,  or  at 
periods  of  low  duties.  The  first  heavy  balance  of  $32,000,000, 
was  in  1791,  before  the  country  was  fairly  rescued,  by  the  opera- 


A  RESCUE  FROM  FOREIGN  TAXATION.  393 

tion  of  the  new  cotiPtitution,  from  the  Free-Trade  period  of  the 
confederation.  During  the  disturbance  of  our  foreign  relations, 
from  1S04  to  1812,  the  year  that  war  was  declared,  there  were  also 
some  heavy  balances  against  us  :  In  180-5,  S24,000,000  ;  in  1806, 
$27,000,000  ;  in  1807,  $29,000,000  ;  in  1808,  $34,000,000  ;  in 
1810,  $18,000,000  ;  and  in  1812,  $38,000,000.  The  first  two 
years  after  the  peace,  the  balances  against  us,  for  want  of  adequate 
protection,  were  very  great :  In  1815,  $60,000,000  ;  and  in  1816, 
$65,000,000.  Though  much  abated,  the  next  three  years  brought 
an  agirregate  balance  against  us,  of  upward  of  $50,000,000.  From 
that  time,  the  balances  against  us,  were  comparatively  light,  and 
some  years  in  our  favor,  a^  above  noticed,  till  the  protective  system 
was  disturbed  and  impaired,  in  1833,  when  the  balances  against  us 
began  again,  and  soon  rose  to  a  fearful  and  ruinous  amount:  In 
1833,  it  was  18,000,000  ;  in  1834.  $22,000,000  ;  in  1835,  $28,- 
000,000;  in  1836,  $61,000,000;  in  1837,  $23,000,000;  in  1838, 
$5,000,000;  and  in  1839,  $41,000,000;  making  an  aggregate 
balance  against  us,  in  seven  consecutive  years,  without  interruption 
or  relief,  of  $198,000,000. 

Accorditig  to  the  premises  before  laid  down,  three  fourths  at 
least  of  this  aggregate  balance  against  us,  that  is,  $148,500,000, 
was  a  positive  tax  on  the  people  of  the  United  States,  for  the  sup- 
port of  foreign  powers,  and  for  the  impoverishment  of  this  country, 
all  paid,  drawn  from  us,  in  seven  years,  or  consolidated  into  foreign 
debts,  to  be  paid  thereafier,  with  interest.  The  whole  of  it,  in- 
deed, was  a  tax  on  the  country,  and  much  more,  all  of  which  an 
adequate  protective  system  might  and  should  have  barred.  It  was 
in  our  power,  under  a  well-adjusted  and  well-sustained  protective 
policy,  to  have  supplied  from  among  ourselves,  all  this  excess  of 
imports  over  exports  —  or  all  that  was  wanted,  for  we  then  really 
imported  much  more  than  was  wanted,  in  the  prodigality  of  waste- 
fulness ;  and  we  could  have  supplied  it  at  lower  rates,  and  in  better 
articles.  When  the  breaking  down  of  the  protective  system,  ef- 
fected by  the  policy  of  that  period,  and  all  its  disastrous,  ruinous 
consequences  to  the  industry,  labor,  and  capital  of  the  country,  are 
considered,  this  loss  of  $198,000,000,  does  not  by  any  means  meas- 
ure the  injury  done  to  the  country.  It  is  enough,  however,  for  our 
present  argument,  that  the  people  of  the  United  States  actually  paid 
the  taxes  imposed  by  foreign  governments,  in  one  form  and  another, 
on  the  products  purchased  with  this  $198,000,000,  amounting  to 
not  less  than  $148,000,000,  without  a  single  penny's  worth  of 


394  AN    AMERICAN    PROTECTIVE    SYSTEM 

equivalent;  with  great  additional  loss,  indeed,  in  the  general  put- 
back  of  the  country,  as  to  the  use  and  application  of  its  capital  and 
labor.  And  they  paid  this  tax  to  foreign  powers  in  seven  years,  or 
became  indebted  for  it,  and  paid  afterward,  and  are  still  paying  — 
for  it  is  not  all  paid  even  yet.  And  yet  all  these  goods  might  have 
been  produced  at  home,  cheaper  and  better  ;  and  all  the  American 
labor  and  capital  that  should  have  produced  them,  were  deprived 
of  so  much  employment,  and  suffered  for  want  of  it  —  were  them- 
selves compelled  to  buy  these  very  things,  and  pay  for  them,  send- 
ing their  money  abroad,  instead  of  using  it  at  home  to  increase 
their  own  and  the  public  wealth.     Was  it  not  a  tax  ? 

Nor  is  this  the  end  of  the  reckoning.  It  is  a  pity,  indeed,  that 
we  have  no  colonial  commercial  records,  of  an  official  character, 
to  instruct  us  on  this  point;  for  those  must  have  been  disastrous 
times,  which  so  exasperated  the  people,  and  at  last  goaded  them 
on  to  rebellion.  And  it  is  worthy  of  note  here,  that  they  were 
troubles,  hardships,  oppressions  of  this  very  kind  —  originating 
from  this  sole  cause,  to  wit,  by  forcing  the  colonists  to  purchase 
their  articles  of  manufacture  from  the  mother-country,  and  thus  to 
pay  her  taxes.  It  is  a  pity,  too,  that  we  have  no  official  records 
of  the  commercial  history  of  the  states  under  the  confederation, 
which  would  be  full  of  instruction  on  the  subject  now  under  con- 
sideration. By  such  means,  we  should  be  able  to  show,  in  figures, 
how  the  money  and  the  wealth  of  the  colonies,  and  afterward  of 
the  states,  before  the  constitution  was  adopted,  were  drawn  from 
the  country,  for  want  of  Protection,  to  enrich  foreign  parts,  and 
strengthen  foreign  powers.  But  we  can  only  begin  with  1791,  from 
which  date,  down  to  1845,  a  showing  has  already  been  made,  from 
public  documents,  of  the  commercial  balances  of  the  country,  in  its 
trade  with  foreign  parts.  A  glance  has  been  taken  at  the  commer- 
cial history  of  Great  Britain,  in  the  same  aspects,  beginning  with 
the  year  1700.  It  has  been  seen  what  that  is,  and  what  a  contrast 
is  presented  in  the  commercial  history  of  the  United  States  :  The 
former  always  drawing  in  balances  in  her  favor,  from  the  wide 
world,  never  failing,  and  for  ever  increasing  in  amount ;  while  the 
United  States  is  almost  always  losing  —  almost  always  making 
sacrifices.  From  1791  to  1845,  inclusive,  the  aggregate  balance 
ao-ainst  this  country,  resulting  from  its  foreign  trade,  as  certified  by. 
public  official  records,  is  $718,959,486.  Three  fourths  of  this  at 
least,  as  already  shown,  or  $539,230,604,  was  a  tax  on  the  people 
of  this  country,  which  they  have  been  forced  to  pay  to  foreign  pow- 


A  RESCUE  FROM  FOREIGN  TAXATION.  395 

ers,  in  a  little  more  than  half  a  century,  not  only  without  the  slifjhtest 
equivalent,  but  with  a  positive  detriment  to  their  interests,  not  less 
than  the  other  quarter — probably  much  more.  By  an  examination 
of  the  commercial  history  of  the  country,  as  displayed  by  the  offi- 
cial records,  all  its  parts  harmonize  with  the  doctrine  which  guides 
us  to  these  results.  Whenever  the  protective  policy  has  prevailed, 
by  the  necessities  of  war,  or  by  legislation  in  peace,  the  balances 
of  imports  against  the  country  are  reduced,  and  occasionally  turn 
the  other  way.  Under  the  effects  of  the  tariff  of  1842,  as  long  as 
it  lasted,  the  balances  were  all  in  favor  of  the  country.  But  when- 
ever duties  have  been  reduced,  and  Protection  diminished,  the  ex- 
cess and  the  increase  of  the  excess  of  imports  over  exports,  has 
followed  as  regularly  and  as  certainly  as  night  follows  day  ;  and 
the  temperature  of  the  weather  is  not  measured  more  accurately  by 
the  thermometer,  than  the  losses  and  gains  of  the  country,  in  its 
foreign  trade,  by  the  depression  and  rise  of  import  duties,  as  they 
relate  to  the  principle  and  objects  of  Protection.  Mathen)atical 
verities  were  never  established  with  greater  certainty  than  this  propo- 
sition ;  for  it  is  itself  determined  by  figures,  which  can  not  err,  when 
legitimately  and  fairly  applied. 

The  following  facts,  as  will  be  seen,  are  but  another  way  of 
coming  to  the  same  result,  in  the  use  of  a  part  of  the  same  prem- 
ises employed  above:  It  appears  from  a  report  of  the  Hon.  J.  P. 
Kennedy,  of  the  27th  Congress,  from  the  committee  on  commerce, 
that,  from  1820  to  1830,  the  aggregate  imports  of  the  United 
States  amounted  to  $798,500,000,  and  the  amount  retained  for  do- 
mestic consumption  to  $568,900,000 ;  and  that,  from  1830  to 
1840,  the  imports  were  $1,302,500,000,  and  the  amount  retained 
for  domestic  consumption  was  $1,103,100,000.  It  is  worthy  of 
remark  here,  that,  as  the  effect  of  the  protective  policy  established 
in  1824,  and  continued  for  a  number  of  years,  the  nation  paid  off 
a  debt  of  one  hundred  millions  ;  and  that,  chiefly  in  the  last  half 
of  the  period  from  1830  to  1840,  when  the  low  rates  of  duties  un- 
der the  Compromise  act  of  1833  were  in  operation,  a  foreign  debt 
of  two  hundred  millions  was  contracted.  It  is  accounted  for  in 
the  above-cited  imports  and  consumptions  of  that  period.  About 
one  hundred  millions  of  the  state  debts  were  contracted  in  1835 
and  1836,  and  nearly  all  of  them  got  into  the  foreign  market  about 
this  time  to  settle  balances  for  excessive  importations. 

One  can  hardly  fail  to  see,  by  these  facts,  that  when  we  are  ac- 
commodated by  exchange  of  products  with  articles  not  convenient 


396  AN    AMEaiCAN    PROTECTIVE    SYSTEM 

for  US  to  produce,  and  so  long  as  itvis  inconvenient,  or  more  profit- 
able to  obtain  them  by  such  exchanges,  we  are  compelled  to  pay 
higher  for  them  than  we  ought  to  pay,  because  the  producers  of 
such  articles  have  a  monopoly  of  our  market,  and  will  have  their 
own  prices;  which  is  the  cause  of  their  reduction  under  an  Amer- 
ican protective  system.  Consequently,  even  in  that  case,  though 
it  is  on  the  whole  a  desirable  exchange,  we  are  burdened,  in  no 
inconsiderable  degree,  with  foreign  taxes.  Secondly,  that  it  is 
desirable,  that  it  is  sound  policy,  and 'a  duty  which  we  owe  to  the 
labor,  capital,  enterprise,  and  weal  of  the  country,  to  rescue  our- 
selves even  from  this  taxation,  as  soon  as  we  are  prepared  ;  and  we 
are  prepared  whenever  capital  is  ready  to  employ  labor  for  this  pur- 
pose, and  when  it  asks  protection  to  begin  the  work.  We  can  almost 
universally  in  the  outset,  in  the  end  always,  produce  the  same  arti- 
cles cheaper,  when  we  can  produce  them  at  all,  as  proved  in  the 
pieceding  chapter.  The  country  is  of  course  benefited,  and  con- 
sumers may  also  be  benefited,  as  elsewhere  shown,  even  when  such 
protected  articles  are  a  little  higher  for  a  season.  They  can  not 
be  long  higher,  and  in  the  end  will  be  cheapened  by  domestic  com- 
petition. But,  thirdly,  whenever  by  the  reduction  or  abolition  of 
protective  duties,  or  by  refusing  to  establish  them  when  capital  so- 
licits it,  American  producers  are  so  weakened  in  a  competition  with 
foreign  producers,  that  the  latter  have  the  advantage,  and  are  able 
to  force  into  our  market  such  large  quantities  of  their  products,  as 
to  turn  the  balance  of  trade  against  the  country,  as  above  proved 
to  have  been  often  done  in  the  progress  of  our  commercial  history, 
then  the  tax  on  the  country,  imposed  by  foreign  powers  and  foreign 
factors,  is  positive,  and  not  less  in  amount  than  three  fourths  of 
the  value  of  the  excess  of  imports  over  exports  ;  and  not  only  so, 
but  the  tax  is  imposed  on  the  industry,  labor,  and  capital  of  the 
country  in  its  crippled  condition,  so  that  being  obliged  to  pay  it 
under  such  circumstances,  doubles,  or  trebles,  or  quadruples  the 
burden.  If  they  could  have  the  business  and  profit  of  which  they 
are  deprived  by  this  want  of  protection,  they  could  pay  this  foreign 
tax,  great  and  heavy  as  it  is,  in  the  shape  of  a  direct  and  naked 
bounty,  with  infinitely  more  ease  than  they  can  sustain  it  when 
thus  imposed.  And  what  would  be  thought  of  such  a  bounty, 
imposed  upon  this  country,  in  the  full  tide  of  its  prosperity,  under 
an  adequate  protective  system  ?  It  could  then  be  endured,  if  it 
were  not  understood  how  it  came  ;  whereas,  the  taxes  paid  by  the 
people  of  the  United  States  to  the  foreign  world,  in  the  prevalence 


A  RESCUE  FROM  FOREIGN  TAXATION.         397 

of  Free-Trade  principles,  by  the  breaking  down  of  Proteciion, 
can  not  be  endured.  The  country  always  breaks  down  under  it; 
and  we  see  by  the  argument  of  this  chapter  why  it  could  not  be 
otherwise. 

We  are  aware  that  Free  Trade  will,  perhaps,  reply  to  the  argu- 
ment of  this  chapter,  that  this  immense  system  of  foreign  taxation, 
entering  into  the  prices  of  all  foreign  products,  is  itself  a  protective 
system.  Our  commercial  history,  however,  demonstrates  that  it  is 
inadequate  ;  and  we  have  elsewhere  shown  that  inadequate  protec- 
tion is  no  protection.  If  the  usurpation  of  the  rights  of  labor  in 
those  foreign  quarters  be  assumed  to  be  equal  to  the  fair  reward 
of  labor  in  the  United  States  —  reward  being  viewed  in  the  liiiht 
of  compensation,  over  and  above  subsistence  —  then  the  productive 
power  of  the  foreign  world  is  a  balance  of  our  own,  with  thig  ex- 
ception, that  we  can  not  afford  to  sacrifice  our  rights  in  a  com- 
mercial strife,  under  Free  Trade,  with  a  power  two  thirds  or 
three  fourths  of  which  is  usurped,  and  which  consequently  gives  it 
an  immense  margin  of  strength  to  spare  on  the  points  of  strife  be- 
tween us  as  parties.  All  that  is  our  own,  is  necessary  to  us ; 
whereas,  any  part  of  this  foreign  usurpation  may  be  relinquished 
for  a  season,  to  deprive  us  of  our  rights.  It  is  for  this  reason  that 
we  require  protection.  All  the  costs  of  imports  which  are  com- 
posed of  foreign  taxation,  constitute  the  rewards  of  our  various 
branches  of  industry,  when,  under  a  system  of  protection,  we 
produce  the  same  things  ourselves;  and  it  is  only  by  protection 
that  we  are  able  to  produce  them. 


398  GAINS    OF    PROTECTION 


CHAPTER    XXV. 

GAINS    OF    PROTECTION    AND    LOSSES    BY    FREE    TRADE. 

Tho  everlasting  Qlijeotion. — The  Charm  of  Hypothesis,  as  compared  with  the  Indiictive 
Mo.le  of  Reasoning — How  things  look  at  a  Distance. — Supplical'on  of  Kmope  to 
j^,„ei-j,.a  — St  Georges  Spear  in  tlie  Tiin>;it  of  the  Dragon — The  aggrcgiite  Los.-*  lo  tl^e 
United  Slates,  since  1791,  for  Want  of  a  Protective  System. — The  Lo.ss  comprehends 
the  U-e  of  ihe  Capital  in  all  Time — Tiie  Effects  of  new  Arts  and  new  Puisuits  under 
a  Protective  Sy.steiii  — A  variety  of  Facts  on  this  Point. 

It  is  well  known  that  the  only  objection  to  protective  duties 
ever  urged,  has  been  the  assumption  —  proved  in  the  foreijoing 
pages  to  be  false  and  groundless  —  that  they  are  taxes,  and  taxes 
to  the  full  amount  of  the  duties  which  are  imposed  on  the 
protected  articles.  There  never  was  an  argument  made  against 
Protection  which  did  not  assume  this,  or  which  alleged  any 
other  objection  that  did  not  resolve  itself  into  this.  The  Free- 
Trade  argument  is  universally  constructed  on  the  principle  of  an 
hypothesis.  It  is  singular  that  a  maiter-of-fact  age,  which  has  long 
since  loaned  its  almost  unqualified  sanction  to  the  inductive  mode 
of  reasoning,  that  is,  reasoning  and  forming  conclusions  from  facts, 
shoidd  have  yielded  so  much  to  this  strange  delusion,  and  that 
whole  states  and  nations  should  have  almost  gone  mad  with  it.  It 
demonstrates  the  sluggishness  of  the  human   mind  in  reducins:  to 

CO  O 

practice  its  own  professed  faith,  and  its  propensity  to  romance  in 
the  affairs  of  life,  rather  than  dig  among  facts,  and  search  tliem  out 
for  doctrine  and  use.  Of  all  modes  of  reasoning,  theorizing,  with- 
out a  basis,  is  most  captivating  to  the  intellectual  sluggard.  He  is 
neither  obliged  to  find,  nor  disposed  to  consider,  facts.  If  they 
come  in  his  way,  he  always  has  a  theory  to  oppose  to  them,  and  if 
they  do  not  accord  with  bis  preconceived  opinions,  they  are  inad- 
missible. He  worships  theory  built  on  hypothesis.  Did  it  not, 
he  asks,  teach  us  how  the  universe  is  kept  in  order,  by  the  principle 
of  gravitation?  But  he  forgets  that  the  fact  of  the  falling  of  an 
ap[)le  led  to  this  discovery  ;  nor  does  he  seem  to  be  aware  that 
there  is  no  conclusion  in  the  theory  of  the  heavenly  bodies,  which 
is  not  deduced  from  ascertained  facts.  Of  all  sciences,  if  this  de- 
serves the  name  of  one,  public  economy,  to  be  safe  and  useful, 
claims,  more,  if  possible,  than  any  other,  to  be  based  on  facts ;  all 


AND    LOSSES    BY    FREE    TRADE.  399 

its  deductions  should  be  founded  on  facts,  and  facts  alone  ;  and  any 
theory,  passing  under  this  name,  which  has  not  such  a  basis,  is 
worthy  of  no  respect.  Free  Trade  is  this  baseless  theory,  with 
the  facts  of  all  history  and  thf  experience  of  all  mankind  against  it. 

A  single  sentence  from  the  London  Times  of  January  1,  1S47, 
uttered  afttT  it  had  copiously  poured  the  unction  of  its  flattery  on 
the  heads  of  the  American  president  and  his  secretary  of  the  treas- 
ury, for  their  able  vindication  of  the  principles  of  Free  Trade, 
will  illustrate  the  relative  position  of  this  country  to  forei2:n  parts, 
in  a  commercial  point  of  view,  better,  perhaps,  than  anything  el.~e: 
"Almost  every  nation  in  the  world,"  says  that  join-nal,  "isdirectly 
interested  in  the  degree  of  liberality  and  friendliness  with  which 
the  L^nited  States  may  open  their  resources  to  the  wants  of  other 
more-crowded  and  less-favored  realms."  This  is  supplication, 
entreaty  —  for  what?  To  allow  Europe  to  live  at  our  expense. 
An  appeal  is  made  to  our  "liberality,"  "friendliness."  We  are 
implored  to  be  charitable.  This  only  to  show  the  importance  that 
is  attached  to  the  controversy.  It  bodes  a  great  strife  when  tiie 
United  States  undertake  to  protect  their  own  interests  —  to  defend 
their  own  rights.  Europe  is  convulsed.  "  Almost  every  nation 
in  the  world,"  says  the  London  Times,  "is  directly  interested." 
A  plainer  truth  was  never  uttered.  The  European  world  observes 
that  labor  has  gained  an  independent  position  in  the  United  States; 
and  it  sees,  that,  if  that  position  be  maintained,  by  protecting  itself, 
all  other  nations  must  be  revolutionized.  Either  American  labor 
or  foreign  despotisms  must  fall.  The  instincts  of  unjust  power 
cause  it  to  quake  on  its  precarious  throne,  and  what  sacrifices  will 
it  not  make  to  defend  its  unrighteous  su|)remacy,  and  absurd  pre- 
tensions? If,  in  apprehension  of  evil  to  itself,  it  will  stoop  to  sup- 
plication, to  entreaty,  by  all  the  ties  of  a  pretended  brotherhood,  it 
is  not  because  it  will  not  put  on  different  airs,  when  once  it  may 
have  recovered  its  position,  and  is  exeinpt  from  such  fears.  Such 
symptoms  demonstrate  a  conscious  weakness,  not  of  misfortune, 
but  of  crime  —  the  crime  of  doing  wrong  to  humanity,  by  depri- 
ving it  of  its  rights. 

All  we  intended  by  drawing  aside  the  curtain  to  exhibit  this 
spectacle,  or  rather  by  employing  the  hand  of  the  culprit  behind,  to 
lift  the  screen  that  hides  his  own  shame,  was  to  show  what  potent 
principles  of  self-preservation  are  invoked,  on  the  side  of  European 
powers,  when  once  they  see  that  American  labor  is  rising  to  pro- 
tect itself;  how  they  will  crouch  to  supplication,  and  how  they 


400  GAINS    OF    PROTECTION 

will  yield  anytliing  for  a  season  in  the  prices  of  their  own  products, 
if  they  can  have  a  chance  of  raising  them  thereafter,  or  if  they  can 
only  preserve  their  markets  at  smaller  profits.  It  is  this  great  bat- 
tle which  reduces  the  prices  of  manufactured  articles  in  tiie  United 
States,  under  a  protective  system  ;  and  this  is  one  of  its  benefits. 
It  reduces  them  generally,  particularly  and  essentially,  as  evinced 
by  an  exhibition  of  facts,  in  a  former  chapter  —  reduces  them  so 
much,  that  the  whole  country,  and  every  party  and  person  in  it, 
are  sensible  of  the  benefit,  the  theory  of  Free  Trade  to  the  con- 
trary notwithstanding. 

As  to  the  fact  that  a  protective  system  rescues  us  from  an  enor- 
mous amount  of  foreign  taxation,  it  is  undoubtedly  the  greatest  and 
most  important  one  that  can  be  named.  It  is  the  real  remedy  — 
the  effective  and  commanding  influence.  It  is  St.  George's  spear 
in  the  throat  of  the  dragon.  This  country  has  yet  to  learn  bow 
it  is  taxed,  and  how  it  has  ever  been  taxed,  to  support  the  Euro- 
pean system  of  society.  It  will  hereafter  be  a  subject  of  astonish- 
ment, that  this  momentous  element  of  public  economy  for  the 
United  States,  was  not  more  fully  developed,  and  brought  to  bear 
upon  the  public  mind,  at  an  earlier  date.  Certainly,  this  has  not 
been  a  defect  in  the  instincts  of  the  people,  but  only  in  the  rulers, 
politicians,  and  statesmen  of  the  country.  Did  not  the  American 
fathers  feel  it  before  the  great  political  rupture  between  themselves 
and  the  mother-country ;  and  was  it  not  the  cause  of  that  rupture? 

It  was  taxation,  such  as  is  described  in  the  preceding  chapter 
—  taxation  comprehensive,  heavy,  intolerable  —  taxation  in  the  very 
mode  now  under  consideration,  by  forbidding  American  manufac- 
tures, and  forcing  the  colonists  to  supply  their  wants  of  this  kind 
throuo"h  British  merchants  ;  it  was  such  a  systeui  of  taxation,  which 
brought  about  the  American  revolution,  and  resulted  in  the  estab- 
lishment of  American  independence. 

Nor  was  the  country  relieved  very  essentially  from  this  system 
of  foreign  taxation  by  the  establishment  of  independence,  till  nearly 
half  a  century  had  elapsed.  From  the  peace  of  1783  to  the  adop- 
tion of  the  constitution  in  1789,  the  confederated  states  were  under 
a  system  of  perfect  Free  Trade,  and  Great  Britain  and  Europe 
drew  away  the  money  and  wealth  of  the  country  as  effectually  as 
before  the  war  of  the  revolution.  We  learn  from  Pitkin's  Statis- 
tical View,  that  our  imports  from  Great  Britain,  for  the  first  year 
after  the  peace  of  '83,  were  six  in  mic  of  our  exports  to  that  em- 
pire ;  and  that  the  annual  average  proportion  of  our  imports  from, 


AND    LOSSES    BY    FREE    TRADE.  401 

over  our  exports  to,  Great  Britain,  from  1783  to  1790,  was  as 
tJine  of  the  former  to  nne  of  the  latter.  Hence  we  find,  by  the 
treasury  documents,  which  give  us  no  light  beyond  that  year,  that 
the  excess  of  our  imports  over  exports,  in  1791,  was  $32,000,000. 
Nor  did  this  country  ever  enjoy  an  effective  protective  system  till 
the  enactment  of  the  tariff  of  1824.  Accordingly,  we  are  not  sur- 
prised—  however  much  we  may  be  mortified  —  to  read  from  Lowe, 
as  cited  by  Mr.  Clay,  in  one  of  his  speeches,  that  "  it  is  now  above 
forty  years  since  the  United  States  of  America  were  definitively 
separated  fiom  us  ;  and  since  [that  time],  their  situation  has  afforded 
a  proof,  that  ihe  benefit  of  mercantile  intercourse  may  be  retained, 
in  all  its  extent,  without  the  care  of  governing,  or  the  expense  of 
defending,  these  once-regretted  colonies."  How  was  "  the  benefit 
of  mercantile  intercourse  retained,  in  all  its  extent"  ?  Simply,  for 
want  of  an  adequate  system  of  protection  in  the  United  States, 
down  to  that  time.  It  was  for  this  reason,  that,  according  to  this 
authority,  and  giving  the  true  version  of  his  language.  Great  Britain 
continued  for  nearly  half  a  century,  to  tax  the  people  of  this  coun- 
try as  effectively  as  she  did  before  the  revolution,  and  in  addition 
to  this,  was  saved  "the  care  and  expense"  of  government.  There 
is  no  other  intelligible  explanation  of  this  remarkable  statement.  The 
American  revolution  and  its  results,  according  to  Lowe,  were  at  first 
regretted  by  British  statesmen  ;  but  it  was  aftervi^ard  found,  that 
they  could  still  tax  the  United  States  as  easily  and  as  effectually  as 
before,  without  expense  and  without  responsibility.  Such  is  the 
teaching  of  Lowe,  and  it  was  undoubtedly  true.  Our  foreign  com- 
mercial history,  as  presented  in  the  preceding  chapter,  from  our  own 
public  documents,  proves  it.  It  is  from  this  enormous  system  of 
foreign  taxation  that  the  protective  poRcy  rescues  the  country. 

It  was  on  the  basis  of  the  principle  which  lies  at  the  foundation  of 
this  system,  that  Henry,  now  Lord  Brougham,  said  in  the  house  of 
commons,  as  elsewhere  cited,  that  "  it  was  well  worth  while  to  stifle 
in  the  cradle  the  rising  manufactures  of  the  United  States  ;"  and  that 
another  member  said,  very  frankly,  which  is  equally  worthy  of  citing 
a  second  time,  as  here  done :  "  It  was  idle  for  us  to  endeavor  to 
persuade  other  nations  to  join  with  us  in  adopting  the  principles  of 
what  was  called  Free  Trade.  Other  nations  knew,  as  well  as  the 
noble  lord  opposite,  and  those  who  acted  with  him,  what  we  meant 
by  Free  Trade  was  nothing  more  nor  less  than,  by  means  of  the 
great  advantages  we  enjoyed,  to  get  a  monopoly  of  all  their  mar- 
kets for  our  manufactures,  and  to  prevent  them,  one  and  all,  from 

26 


402  GAINS    OF    PROTECTION 

ever  becoming  manufacturing  nations.  When  the  system  of 
reciprocity  and  Free-Trade  had  been  proposed  to  a  French  am- 
bassador, his  remark  was,  that  the  plan  was  excellent  in  theory,  but 
to  make  it  fair  in  practice,  it  would  be  necessary  to  defer  the  at- 
tempt to  put  it  in  execution  for  half  a  century,  until  France  should 
be  on  the  same  footing  with  Great  Britain,  in  marine,  in  manufac- 
tures, in  capital,  and  the  many  other  peculiar  advantages  which  it 
now  enjoyed." 

The  Edinburgh  Review,  in  speaking  of  the  reduction  of  duties  by 
the  Compromise  act  of  1 S33,  said  :  "  We  have  no  doubt  that  it  has 
given  the  death-blow  to  the  American  system."*  The  London 
Spectator,  in  1833,  said  :  "  More  general  considerations  tend  to 
show,  that  the  trade  between  the  two  countries  [the  United  States 
and  Great  Britain]  most  beneficial  to  both,  must  be  what  is  com- 
monly called  a  '  colonial  trade,'  the  new-settled  country  importing 
the  manufactures  of  the  old,  in  exchange  for  its  own  raw  produce. 
In  all  economical  relations,  the  United  States  still  stand  to  Eng- 
land in  the  relation  of  colony  to  mother-country." 

These  citations,  certainly,  may  be  regarded  as  sufficiently  intel- 
ligible, and  quite  to  the  point  aimed  at.  They  are  not  ignorant  of 
the  nature  and  results  of  the  colonial  relation  between  themselves 
and  the  United  States,  and  may  well  be  excused  for  advocating 
that  state  of  thino;s  which  is  tantamount,  the  benefits  of  which  are 
all  theirs,  and  all  the  disadvantages  ours. 

The  saving  and  increase  of  national  capital  effected  by  a  protec- 
tive system,  as  before  shown,  are  considerations  of  no  mean  impor- 
tance. Take,  for  example,  the  aggregate  balance  of  imports  over 
exports,  from  1791  to  1845,  inclusive,  fifty-five  years,  namely, 
$718,959,486,  as  exhibited  in  the  preceding  chapter;  or  in  round 
numbers,  $719,000,000  ;  all  which  might  and  should  have  been 
saved  to  the  country  by  a  protective  system.  Add  to  this  an  av- 
erage gain  of  seven  millions  a  year,  in  the  excess  of  exports  over 

•  The  merits  of  the  Coini)romise  act,  as  the  best  possible  measure  for  the  time 
and  circumstances,  to  rescue  the  American  manufactures  from  the  mortal  blow  thea 
aimed  at  them  by  the  administration,  through  Mr.  Verplanck's  bill,  at  that  mo- 
ment pendin?,  and  certain  to  become  a  law,  except  as  the  Compromise  headed  and 
subverted  the  plan,  are  not  at  all  disparaged  by  this  very  natural  remnrk  of 
a  foreigner.  The  plan  of  the  Compromise  act  was  to  save  the  manuf ictures 
then  from  the  doom  pronounced,  and  to  give  time  for  reflection  and  for  a  re-edifi- 
cation of  the  American  manufacturing  system.  That  the  Compromise  ran  out,  and 
the  duties  and  revenue  ran  down,  was  no  fault  of  the  plan,  but  the  misfortune  of 
the  country  to  have  remained  so  long  in  such  hands.  At  last,  however,  the  tariff  of 
1842  came  to  the  rescue,  a  tardy,  but  exact  fulfilment  of  the  plan  of  the  Compromise. 


AND    LOSSES    BY    FREE    TRADE.  403 

imports  for  this  period,  which  was  the  average  under  the  tariff  of 
1842,  and  which  would  fall  much  short  of  a  reasonable  gain  for 
the  United  States  in  its  foreign  trade,  as  compared  with  the  gains 
of  Great  Britain,  before  shown  (the  average  of  which,  from  1700 
to  1787,  was  upward  of  sixteen  millions  of  dollars  a  year,  rapidly 
increasing  from  this  last  date) ;  and  with  this  addition  of  seven 
millions  a  year,  for  fifty-five  years,  the  sum  of  our  minus  quantity 
for  this  period,  as  compared  with  what  we  were  justly  entitled  to, 
will  be  $1,104,000,000.  This,  it  will  be  observed,  does  not  in- 
clude the  losses  we  sustained  under  the  confederation,  which  were 
greatly  in  excess  of  any  time  since  ;  but  wanting  authentic  docu- 
ments, they  can  not  be  reckoned,  and  we  are  confined,  in  this  cal- 
culation, within  the  limit  of  1791.  Here,  then,  is  a  positive  loss 
to  the  country,  in  fifty-five  years,  of  $1,104,000,000,  a  principal 
sum,  without  reckoning  the  interest  on  it  as  capital  —  all  for  want 
of  a  protective  system.  Consider,  then,  that  an  adequate  protective 
system  in  existence  all  this  while,  after  having  saved  this  capital  of 
$1,104,000,000  to  the  country,  as  it  was  due  and  lost  from  time  to 
time  in  parts,  would  have  put  it  to  use,  so  as  to  have  produced  at 
least  the  usual  rate  of  interest,  six  per  cent. 

In  running  the  eye  over  the  tables,  any  one  will  see  that,  if  we 
reckon  the  interest  of  the  entire  sum  for  one  third  of  this  period  of 
fifty-five  years,  it  will  without  doubt  be  less  than  the  result  that 
would  be  obtained  from  an  accurate  calculation  on  each  sum  from 
the  time  it  became  due,  or  was  lost,  to  1845.  Or,  instead  of  one 
third,  say  seventeen  years,  which  is  the  nearest  integral  number  at 
which  interest  at  six  per  cent,  doubles  the  principal  sum.  By  this 
rule,  the  actual  loss  to  the  country,  as  will  be  seen,  for  want  of  an  ad- 
equate protective  system,  from  1791  to  184-5,  was  $2,208,000,000. 
The  principal  sum  of  $1,104,000,000,  was  a  loss  of  so  much  mon- 
ey ;  and  the  proof  that  six  per  cent,  is  not  too  high  a  rate  of  inter- 
est, is  found  in  the  facts,  first,  that  it  is  the  lowest  rate  which  has 
usually  been  paid  in  this  country  ;  and  next,  that  more  than  that 
could  be  made  in  the  use  of  it,  or  it  never  would  or  could  be  paid. 
It  would  probably  be  nearer  the  truth  to  say,  that,  for  the  last  fifty 
years,  or  even  from  the  date  of  American  independence,  under  a 
steady  and  adequate  protective  system,  money,  in  the  hands  of  the 
enterprising  population  of  this  country,  would  have  been  worth  ten 
or  twelve  per  cent. 

The  elements  of  this  calculation,  as  will  be  seen,  are  drawn  from 
authentic  documents;  and  the  reasoning,  leading  to  the  result,  is 


404     GAINS  OF  PROTECTION  AND  LOSSES  BY  FREE  TRADE. 

based  on  facts  and  principles,  which,  it  is  believed,  can  not  be  easily 
disturbed.  It  may  be  surprising  to  those  who  have  not  reflected 
upon  the  subject;  but,  it  may  be  asked,  in  view  of  the  premises, 
how  can  the  result  be  otherwise?  It  will  also  be  seen,  that  the 
reckoning  does  not  stop  at  this  point;  and  that,  to  be  fully  appre- 
ciated, it  must  be  carried  on,  from  age  to  age,  by  the  same  ride, 
swelling  and  rolling  up  the  national  losses,  or  the  alternative  con- 
tingent accumulations  of  wealth,  that  belong  to  the  subject,  till  the 
powers  of  calculation  are  literally  burdened  with  the  task.  There 
is  no  remedy  for  the  past.  This  $2,208,000,000,  and  all  its  con- 
tingent beneficial  results,  by  being  put  and  kept  in  use,  doubling 
itself  in  every  seventeen  years,  are  lost  for  ever.  The  only  remedy 
that  can  be  applied,  is  for  the  future. 

But  this  calculation,  based  on  the  ordinary  six  per  cent,  for  the 
use  of  money,  does  not  by  any  means,  nor  by  far,  comprehend  the 
case.  The  enterprise  of  the  people  of  this  country,  under  any  tol- 
erable system  of  protection  —  take,  for  example,  the  seven  years 
subsequent  to  the  enactment  of  the  tariff  of  1824,  and  the  shorter 
period  of  the  influence  of  the  tariff  of  1842  —  has  never  failed  to  do 
much  better,  on  the  average,  with  every  species  of  capital,  tlian  an 
increase  of  six  per  cent.  In  the  first  place,  the  average  interest  of 
money  has  never  been  less  than  that,  to  which  must  be  added  the 
profits  of  those  who  could  afford  to  pay  such  interest,  two,  five,  ten, 
and  sometimes  fifteen  or  twenty  per  cent.,  to  arrive  at  the  true  re- 
sult. In  the  next  place  —  and  by  no  means  the  least  important 
item  —  the  steady  and  firm  rise  in  the  value  of  every  species  of 
property,  under  a  system  of  adequate  protection,  claims  to  come 
into  this  reckoning,  and  necessarily  belongs  to  it.  Land  rises ;  im- 
provements of  every  description,  private  and  public,  on  a  small  or 
large  scale,  rise  ;  stocks  rise  ;  farms  in  the  vicinity  of  manufactu- 
ring villages  and  towns,  rise ;  and  by  the  increase  and  multiplica- 
tion of  these  establishments,  the  influence  extends  over  the  whole 
country,  to  affect  every  farm  and  every  farmer,  every  bit  of  prop- 
erty and  everj^  owner  thereof,  in  the  same  way.  The  Hon.  Mr. 
Ramsey,  of  Pennsylvania,  stated  on  the  floor  of  Congress,  in  1846, 
that,  since  the  enactment  of  the  tariff  of  1842,  farms  in  Schuylkill 
county,  in  consequence  of  the  encouragement  given  by  Protection 
to  the  coal  business,  had  doubled  in  value,  and  that  farms  in  the 
adjoining  counties,  in  proportion  to  their  proximity  to  the  mines 
and  the  business  created  by  them,  felt  the  same  influence.  So  in 
the  iron  regions  of  Pennsylvania  and  elsewhere.     So  in  the  case 


BENEFITS    OF    NEW    ARTS    AND    OF    NEW    PURSUITS.       405 

of  all  great  and  important  articles,  the  home  production  of  which 
has  been  encouraged  by  Protection.  Every  species  of  property 
around  their  centres  of  industry  and  activity,  comprehending  wide 
regions,  and  extending,  more  or  less,  to  the  farthest  bounds  of  the 
Union,  has  risen  in  value.  All  the  minor  manufacturing  establish- 
ments, and  all  the  mechanic  arts,  in  the  aggregate,  exert  an  im- 
mense influence  of  the  same  kind,  under  a  system  of  Protection. 
Labor  rises  ;  the  products  of  agriculture  rise  ;  everything  rises,  but 
the  prices  of  the  protected  articles  of  manufacture,  which  are  always 
reduced,  under  such  a  system,  as  before  shown.  It  must  be  seen, 
therefore,  that  the  usual  rate  of  interest  for  money,  scarcely  begins 
to  measure  the  increase  of  value  in  the  capital  of  the  country,  as 
the  result  of  a  protective  system.  Consequently  it  will  be  seen, 
that  the  estimate  above  made  of  an  aggregate  loss  to  the  country,  of 
$2,208,000,000,  from  1791  to  1845,  for  want  of  Protection,  does 
not  even  approximate  toward  the  reality. 

It  must  be  obvious  to  every  reflecting  mind,  that,  whenever  a 
new  productive  art,  or  a  new  productive  pursuit,  is  started  in  the 
community,  and  sustained,  it  is  a  benefit  to  every  other  productive 
art  and  pursuit,  directly  or  indirectly,  proximately  or  remotely,  be- 
cause it  takes  one  or  more  persons  —  in  some  cases  many,  even 
,  thousands  —  from  some  other  pursuit  or  pursuits,  and  constitntes 
them  customers  to  other  vocations,  as  consumers  of  their  products, 
instead  of  being  themselves  producers  of  the  things  which  they 
now  have  occasion  to  consume.  They  give  to  those  engaged  in 
the  pursuits  which  they  left,  or  would  otherwise  have  been  engaged 
in  themselves,  more  and  a  better  business ;  these  latter,  in  conse- 
quence, become  Letter  custon)ers  to  others  ;  and  these  others  to 
others  still,  until  the  entire  round  of  the  productive  arts,  and  the 
productive  and  useful  pursuits  of  life,  is  reached  and  benefited  by 
additional  demands  on  the  industry  of  all.  Besides  this,  every 
new  art  or  pursuit,  the  products  of  which  are  essential  and  impor- 
tant to  the  community,  almost  necessarily  calls  into  existence  other 
new  arts  and  pursuits,  to  supply  its  demands;  and  these  latter,  the 
offspring  of  the  former,  themselves  become  parents  of  other  arts 
and  pursuits,  in  their  turn  ;  and  so  on,  in  almost  endless  progres- 
sion. It  diversifies  labor,  and  makes  every  species  more  valuable 
to  itself,  because  it  has  less  competition,  and  there  is  more  demand 
for  it.  Nor  is  it  to  be  forgotten,  that  every  product  of  every  new 
art  or  pursuit,  and  the  effect  of  every  new  application  of  skill  and 
labor,  is  a  new  and  substantial  element  of  the    commonwealth, 


406       BENEFITS    OF    NEW    ARTS    AND    OF    NEW    PURSUITS. 

which  did  not  exist  before,  difFusing  its  benefits  all  around.  It  13 
so  much  addition  to  the  common  stock  of  valuables  —  to  the  gen- 
eral, to  national  wealth.  It  is  no  answer  to  this,  to  say,  that  these 
several  or  many  parties  could  or  would  have  done  as  much  in  old 
arts  and  pursuits  ;  for  those  engaged  in  the  old  will  always  pro- 
duce as  much  as  the  wants  of  the  community  require.  The  effect 
of  the  multiplication  of  productive  arts  and  pursuits  under  a  pro- 
tective system,  is  to  make  all  arts  and  pursuits,  old  and  new,  more 
active,  and  more  profitable  to  the  parties,  as  well  as  more  produc- 
tive of  national  wealth.*  Suppose  these  new  arts  and  new  call- 
ings, each  occupying  a  like  position  of  importance  in  its  relations, 
are  multiplied  indefinitely  in  a  great  comnmnity  —  that  they  go  on 
in  endless  progression  of  increase  as  to  number  —  and  that  each 
becomes  a  nucleus  of  indefinite,  ceaseless  aggregation.  Their 
power  of  augmenting  national  wealth,  then,  becomes  equally  indefi- 
nite, boundless,  interminable,  immeasurable. 

The  new  arts  and  new  callings  that  have  grown  up  in  the  Uni- 
ted States,  under  the  protective  policy,  can  scarcely  be  counted, 
and  the  growth  of  some  of  them  has  become  gigantic  in  their  in- 
terests, and  in  the  ramifications  of  their  influence  on  other  pre- 
existing interests,  to  put  them  forward  with  equal  strides,  and  to 
raise  them  to  a  corresponding  importance. 

It  has  been  ascertained  and  well  certified,  that  the  Glenham 
woollen  factory,  at  Fishkill,  New  York,  with  a  capital  of  $140,000, 
gives  profitable  employment  to  $1,422,000  worth  of  other  Ameri- 
can capital,  chiefly  agricultural,  in  items  as  follows :  66,000  sheep, 
S2  a  head,  $132,000  ;  22,000  acres  of  pasture  land,  to  feed  the 
sheep,  supposed  to  be  worth  in  that  county,  $50  an  acre, 
$1,100,000  ;  farms  employed  to  the  extent  of  2,600  acres,  worth 
$70  an  acre,  $182,000  ;  other  capital,  to  furnish  teazles,  firewood, 
coal,  provender,  &c.,  &c.,  $8,000.  Total,  $1,422,000.  To  this 
should  be  added  the  sum  of  the  wages  paid  to  the  operatives  and 
agents  of  the  factory,  which  would  considerably  increase  the 
amount  of  capital  employed.  Nor  is  this  the  end  of  the  calcula- 
tion.    All  the  persons  employed  in  and  about  this  establishment, 

"  The  manufacture  of  gold  pens  is  a  remarkable  instance  of  the  introduction  and 
growth  of  a  new  art.  It  is  not  ten  years  since  they  were  first  made,  and  it  is  es- 
timated that  one  million  a  yrar  are  now  manufactured  in  New  York,  using  up  800 
pounds'  weight  of  gold.  The  reduction  of  price  by  competition  is  no  less  remark- 
able. They  were  at  first  sold  for  $5,  and  may  now  be  had  for  $1  50  cts.  and  $1. 
A  single  manufacturer  employs  in  this  business  a  capital  of  $80,000,  and  expends 
$1,000  a  week  for  labor. 


BENEFITS    OF    NEW    ARTS    AND    OF    NEW    PURSUITS.       407 

all  employed  to  tend  the  sheep  and  cultivate  the  farms,  to  furnish 
teazles,  fuel,  and  provender,  and  to  supply  any  and  all  other  de- 
mands, are  withdrawn  from  other  pursuits,  to  afford  them  a  better 
chance  of  profit,  and  become  customers  to  a  variety  of  callings, 
and  to  a  great  extent,  where  they  would  otherwise  have  been  them- 
selves employed. 

The  city  of  Lowell,  Mass.,  is  the  sole  creation  of  the  protective 
policy.  In  1821,  the  ground  on  which  it  stands  was  used  for  or- 
dinary agricultural  purposes,  and  was  then  bought  by  the  Merri- 
mack company.  In  1S45  it  had  a  population  of  30,000,  of  which 
nearly  one  third  were  operatives  in  the  mills,  consisting  of  6,320 
females,  and  2,915  males.  The  capital  invested  in  manufacturing 
and  mechanical  enterprises,  was  $12,000,000.  The  annual  con- 
sumption of  cotton,  61,100  bales;  (wool  not  given,  but  great;) 
of  coal,  12,500  tons;  of  wood,  3,270  cords;  of  oil,  67,842  gal- 
lons ;  of  charcoal,  600,000  bushels ;  of  starch,  800,000  pounds. 
Of  course,  these  are  only  the  leading  and  principal  articles  of  con- 
sumption. More  than  a  million  and  a  half  of  dollars  a  year  are 
paid  for  labor,  and  the  profits  are  about  the  same. 

Here,  tiien,  are  30,000  persons  withdrawn  from  other  occupa- 
tions of  the  country  by  means  of  these  establishments,  and  concen- 
trated on  this  single  point,  all  living  by  them,  and  giving  so  much 
better  chances  for  those  occupying  the  places  which  they  would 
otherwise  have  filled,  both  parties  becoming  customers  of  each 
other,  directly  or  indirectly.  To  this  population  must  be  added 
that  employed  to  supply  the  raw  cotton,  the  wool,  the  coal,  the 
wood,  the  oil,  the  starch,  the  food  and  clothing  for  30,000  persons, 
the  building  materials,  the  erection  of  the  buildings,  the  furnishing 
of  the  houses,  and  the  thousand  articles  of  consumption  that  can 
not  be  named.  If  it  be  supposed  that  the  capital  of  $12,000,000 
invested  at  Lowell  employs  other  capital  of  the  country,  in  propor- 
tion to  that  invested  at  Fishkill,  New  York,  as  above  noticed,  that 
other  capital  thus  employed  would  amount  to  $121,885,714.  Nor 
does  the  vast  benefit  to  other  pursuits  of  the  country,  in  preventing 
over-production,  and  in  supporting  the  prices  of  their  products,  by 
withdrawing  from  them  these  30,000  persons  at  Lowell,  and  the 
very  great  additional  population  occupied  in  charge  of  the  one  hun- 
dred and  twenty  millions  of  other  capital  employed  by  Lowell,  come 
into  tills  reckoning. 

There  are  invested  in  the  iron-works  of  the  United  States,  ex- 
clusive of  iron  manufactories,  upward  of  $20,000,000.     (See  Fish- 


408      BENEFITS    OF    NEW    ARTS    AND    OF    NEW    PURSUITS. 

er's  National  Magazine,  June,  1 S46.)  Say  $20,000,000.  At  the 
same  rate  of  calculation,  demonstrating  the  result  in  the  case  of  the 
Glenham  factory,  at  Fishkill,  this  $20,000,000  invested  in  the  iron- 
works of  the  United  States  employs  other  capital,  of  all  kinds,  to 
the  amount  of  $203,142,857,  not  reckoning  the  capital  of  labor 
employed  in  these  works,  and  the  beneficial  effects  on  other  spe- 
cies of  labor  from  which  this  is  withdrawn. 

The  Hon.  Mr.  Ramsay,  of  Pennsylvania,  gave  to  the  house  of 
representatives  some  instructive  statistics  on  the  coal-trade.  (See 
National  Intelligencer,  September  1, 1 846.)  A  part  of  them,  bear- 
ing on  the  point  now  under  consideration,  lead  to  the  following  re- 
sult :  that  the  investment  of  capital  for  the  coal  business,  in  the 
single  county  of  Schuylkill,  in  canals,  boats,  horses,  railroads,  cars, 
locomotives,  collieries,  landings,  working  caj)ital,  coal-land,  &c., 
&c.,  amounted  to  $26,856,000  ;  that  $9,330,000  of  this  was  added 
under  the  tariff  of  1842;  that  the  agricultural  products  consumed 
in  1845  by  those  engaged  in  the  coal  business  of  that  county,  such 
as  wheat,  flour,  corn,  rye,  buckwheat,  oats,  hay,  straw,  beef,  pork, 
potatoes,  poultry,  butter,  lard,  milk,  eggs,  fruit,  vegetables,  &c., 
&c.,  amounted  to  $965,000  ;  that  tlie  amount  of  the  same  products 
consumed  in  1841  was  only  $588,000;  showing  an  increase,  in 
four  years,  of  $377,000  ;  that  the  merchandise  of  various  kinds 
consumed,  same  year  (1845),  amounted  to  $1,758,000  —  increase 
on  1841  of  $840,000  ;  that  many  articles  of  considerable  amount 
were  omitted  in  this  reckoning  ;  that  the  farms  in  the  county  had 
doubled  in  value,  and  the  value  of  those  in  adjoining  counties  was 
much  increased  by  the  same  cause  ;  that  the  amount  of  anthracite 
coal  taken  to  market  had  risen  from  360  tons  in  1820,  to  2,000,000 
in  1845  ;  to  all  which  should  be  added  the  navigation  interest  to  be 
found  in  the  coal-fleet,  engaged  in  this  trade,  a  part  of  which,  some 
scores  of  vessels,  is  constantly  seen  waiting  for  and  taking  in  car- 
goes, at  the  depot  on  the  Delaware,  above  Philadelphia.  The  em- 
ployment which  this  trade  gives  to  labor,  the  increased  value  which 
it  imparts  to  both  labor  and  property,  and  the  wide-spread  commer- 
cial activity  which  it  creates,  bringing  profit  to  all  parties,  are  but 
one  instance  of  the  power  and  benefits  of  aggregatio?i,  which  a 
single  great  interest,  like  this,  carries  along  with  it. 

The  whole  manufacturing  capital  of  the  United  States  was  esti- 
mated some  years  ago  at  $300,000,000.  The  Hon.  Charles  H. 
Carroll,  of  New  York,  in  a  speech  in  Congress,  1846  (see  National 
Intelligencer,  August  7, 1846),  puts  the  minimum  estimate,  for  the 


BENEFITS    OF    NfeW    ARTS    AND    OF    NEW    PURSUITS.       409 

present  time,  at  $500,000,000.  It  will  be  sufficient  for  the  present 
purpose,  however,  to  take  the  first-named  estimate  of  $300,000,000. 
If  this  aggregate  be  supposed  to  employ  other  capital  of  the  coun- 
try, ill  the  same  proportion  as  the  Clenhatn  factory,  without  count- 
ing itself,  or  the  wages  of  labor  em|)loyed  in  the  establishments,  it 
puts  in  active  operation,  and  |)rofital)ly  sustains,  other  property  to 
the  amount  of  $3,047,143,857.  This,  as  must  be  admitted,  is  an 
astonisliing  result. 

Some  manufactories  may  employ  less,  some  more,  of  other  capi- 
tal, in  pioportion  to  their  own  investments,  than  that  at  Fishkill, 
New  York.  No  accuracy,  however,  derivable  from  the  minutest 
infoiination  of  facts,  could  vary  this  general  result,  so  as  to  affect 
the  lesson  which  it  teaches,  in  showing  Iidw  new  arts  and  new  cal- 
lings, in  the  aggregate,  under  a  protective  system,  promote  private, 
general,  and  national  wealth. 

Manufacturing  and  other  arts  create  the  only  market  on  which 
American  agicultural  labor  can  rely.  Does  not  every  one  see  this 
in  the  experience  of  the  past?  Look  at  a  manufacturing  village. 
How  quick  it  raises  the  prices  of  land  in  the  vicinity,  and  turns 
farms  into  gardens,  which  are  the  most  profitable  species  of  agri- 
culture. And  not  only  is  there  this  near  benefit,  but  it  branches 
out,  and  connects  itself  with  the  agriculture  of  the  whole  Union. 
Every  new  manufactory,  of  whatever  kind,  and  in  whatever  place, 
gives  life,  activity,  and  profit,  to  agriculture,  on  a  large  scale.  By 
these  establishments,  the  workshops  of  Europe  are  brought  to  the 
door  of  American  farmers  —  are  planted  alongside  of  their  fields  — 
and  the  two  parties  supply  each  other's  wants  without  the  costs  of 
transportation  over  seas,  the  farmer  getting  as  much,  or  nearly  as 
much,  at  home,  as  his  products  would  command  abroad,  thus  saving 
the  costs  of  transport,  and  the  parties  retain  among  themselves  all 
the  profits  of  manufacturing  skill  and  labor,  and  all  the  additional 
values  which  are  imparted  by  art  and  labor  to  the  raw  material. 


410  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 


CHAPTER    XXVI. 

THE   EFFECTS   OF   A  PROTECTIVE   SYSTEM    ON   THE    PRICES   OF 

AMERICAN    LABOR. 

Consideration  of  the  contradictory  Averments  on  this  Point. — The  Facts  of  the  Case. — 
Statistics  bearing  on  the  (Question. — The  Effect  of  Low  Wages  on  the  Character  of  the 
People. 

A  PROTECTIVE  SYSTEM  raises  the  prices  of  American  labor.  As 
this  has  been  drawn  in  question,  and  even  denied,  not  alone  by  men 
upon  the  common  level  of  society,  but  by  high  and  influential  func- 
tionaries of  the  government  of  the  United  States,  in  their  official 
documents,  it  becomes  necessary  to  subject  the  question  to  the 
proof  of  facts.  The  president  of  the  United  States,  in  his  annual 
message  of  1845,  said  :  "  It,"  the  tariff  of  1842,  "  does  not  benefit 
the  laborers,  whose  wages  are  not  increased  by  it."  His  secretary 
of  the  treasury,  in  his  annual  report,  accompanying  that  message, 
said  :  "  The  wages  of  labor  have  not  augmented  since  the  tariff  of 
1842,  and  in  some  cases  they  have  diminished."  —  "The  wages 
of  labor  did  not  increase  in  any  corresponding  ratio  —  or  in  any 
ratio  whatever."  In  their  annual  documents  of  the  same  kind,  for 
1846,  they  reiterate  the  same  things  in  substance  —  the  secretary 
more  emphatically  than  before.  He  labors  away  with  assertion,  by 
a  frequent  and  long-continued' repetition  of  identical  ideas. 

These,  it  will  be  observed,  are  assertions  oi  fact.  If  it  were 
proper  to  introduce  such  a  topic  in  such  documents,  one  might  say 
with  at  least  equal  propriety,  that  it  was  imperatively  incumbent  on 
the  authors  to  substantiate  their  assertions  of  fact  with  facts.  This, 
however,  was  not  attempted,  and  the  documents  were  sent  forth 
upon  the  community,  with  all  the  weight  and  influence  of  their  high 
official  character,  as  if  there  were  no  question  of  the  facts  asserted  ; 
and  it  is  the  more  to  be  regretted,  as  the  facts  asserted  were  not 
true,  and  could  not  be  substantiated,  as  the  evidence  about  to  be 
exhibited  will  show. 

"  The  ratio"  above  referred  to  by  the  secretary,  was  the  average 
increase  of  duties  on  [)rotected  articles,  from  20  per  cent,  as  they 
existed  before  the  tariff  of  1842,  to  upward  of  40  per  cent,  by  that 


ON    THE    PRICES    OF    AMERICAN    LABOR.  411 

act,  as  he  says,  though  in  fact  it  did  not  exceed  37  per  cent.  But 
that  is  no  matter  in  this  place.  The  secretary  asserts,  that,  ahhough 
*'  the  average  of  duties  was  more  than  doubled,"  the  wages  of  labor 
were  not  more  than  doubled,  or  "  did  not  increase  in  a  correspond- 
ing ratio."  Resting  the  matter  here,  it  would  be  hard  to  say  what 
is  proved.  For  who  ever  pretended,  that  the  wages  of  labor  rise, 
"in  a  ratio  corresponding"  with  the  average  increase  of  duties? 
If  they  rise  at  all,  it  is  a  manifest  benefit.  But  the  secretary  adds, 
"  or  in  any  ratio  whatever."  This  latter  is  an  important  point. 
But  it  is  singular,  that,  in  the  first  member  of  the  sentence,  he 
should  admit  that  they  did  rise,  though  "  not  in  a  corresponding 
ratio,"  and  in  the  last  member,  deny  it.  He  may  be  safely  left  in 
his  own  dilemma.  But  in  another  place  he  asserts  positively,  "that 
the  wages  of  labor  have  not  augmented  since  the  tariff  of  1S42,  and 
that  in  some  cases  they  have  diminished."  This  manifestly  brings 
us  to  the  question.  The  president,  as  will  be  observed,  stops  a 
little  short  of  the  secretary,  and  only  says,  that  "the  wages  of  labor 
were  not  increased  by  the  tariff  of  1842,"  which  also  brings  us  to 
the  question  —  a  question  of/act. 

It  might  be  asked  with  great  force,  did  neither  of  these  gentle- 
men ever  think,  that  it  is  a  blessing  to  labor,  to  have  work  ?     Sup- 
pose its  wages  are  not  increased,  if  they  are  sufficient  and  satisfactory ; 
will  these  gentlemen  find  fault  with  this,  if  the  laborer  himself  does 
not?     If  they  had  dared  to  say,  that  there  was  no  employment  for 
labor,  under  the  tariff  of  1842,  they  would  have  made  a  decided 
case.     But  one  says,  wages  did  not  increase ;  and  the  other  ven- 
tures to  say,  that  in  some  cases  they  diminished.     Did  not  increase 
from  what  standard  ?     That  before  the  period  of  the  tariff  of  1842  ; 
or  that  which  this  period  established  ?     This  is  a  point  of  at  least 
some,  not  inconsiderable,  importance.    If  it  could  be  known  where 
these  gentlemen  mean  to  take  up  their  position,  one  could  not  re- 
fuse a  fair  challenge  on  this  question.     Everybody  knows  that,  in 
1840,  labor  went  begging  for  bread,  and  could  not  always  get  it. 
The  Hon.  Simon  Cameron,  in  the  words  cited  from  him  below, 
tells  us,  and  calls  the  president  of  the  senate,  Mr.  Dallas,  to  wit- 
ness, that,  in  1840,  "  there  were  over  five  hundred  applicants — 
healthy,  vigorous  men  —  for  the  place  of  ^/p-s/ai'e,"  in  a  court  of 
Philadelphia,  "  to  get  bread  for  their  families".      It  is  also  a  fact, 
that  an  ex-governor  of  Pennsylvania  wept,  when  General  Harrison 
was  obliged  to  refuse  him  an  office  in  that  commonwealth,  because, 
he  said,  "  he  was  poor  and  needed  it". 


412       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

If  the  president  and  his  secretary  mean  to  say,  that  the  wages  of 
labor,  under  the  tariff  of  1842,  did  not  rise  above  the  level  of  wages 
in  1840,  one  would  be  very  much  surprised  ;  and  if  they  mean  to 
say,  that  they  did  not  rise  above  the  standard  of  the  period  of  the 
tariff  of  1842,  it  is  a  simple  truism;  it  is  saying  that  a  thing  is  equal 
to  itself. 

Since,  however,  they  have  raised  the  question  about  wages  of 
labor,  they  must  meet  the  facts.  First,  then,  they  do  not  pre- 
tend, that  labor  could  not  find  employment  under  the  tariff  of  1842. 
This  point,  settled,  is  a  very  important  one. 

The  following  is  an  extract,  in  point,  from  a  speech  of  the  Hon. 
Simon  Cameron,  United  States  senator  from  Pennsylvania,  deliv- 
ered July  22,  1846,  on  the  reduction  of  the  tariff  of  1842,  while 
that  of  1846  was  under  debate;  and  it  is  not  the  less  valuable  as 
coming  from  one  of  the  same  political  party  with  the  president  and 
secretary,  who  have  expressed  themselves  as  above  cited : — 

"  The  individual  cases  of  distress,  which  pervaded  the  country 
for  a  period  preceding  the  law  of  1842,  were  absolutely  heartrend- 
ing. Rich  men  not  only  lost  their  fortunes,  but  poor  men  lost  their 
means  of  living.  Our  furnaces,  and  our  forges,  and  our  work- 
shops, were  emptied  ;  our  merchants  were  ruined  ;  and  our  far- 
mers, our  substantial  yeomanry,  many  of  them  with  abundance  of 
products,  for  want  of  a  market,  found  themselves  in  the  hands  of 
the  sheriff.  Not  a  section  of  the  whole  country  but  afforded  abun- 
dant evidence  of  the  truth  of  this  picture.  .  .  I  remember,  and  you, 
Mr.  President  [Dallas],  doubtless  know,  that,  in  the  organization 
of  a  new  court  in  Philadelphia,  there  were  over  500  apf)licants  for 
the  place  of  a  (ip-stave  !  Healthy,  vigorous  men  sought  this  station, 
to  get  bread  for  their  families!  .  .  Do  gentlemen  desire  these  scenes 
renewed  ?  Will  men  never  learn  wisdom  by  experience  ?  How  is 
it  now  [under  the  tariff  of  1842]  ?  How  changed  the  scene  !  If 
a  magician's  wand  had  been  waved  over  our  country,  the  result 
would  hardly  have  appeared  more  like  enchantment,  than  the  reality 
now  before  us.  No  man  is  idle  who  is  willing  to  work.  Contented, 
smiling  faces  are  everywhere  to  be  seen.  The  busy  hum  of  indus- 
try gladdens  the  ear  in  all  directions.  Everybody  is  prosperous, 
and  everybody  ha|)py." 

It  was  not  necessary,  then,  under  the  tariff  of  1842,  for  "  five 
hundred  healthy  and  vigorous  men,"  to  go  begging  for  the  office 
of  "tip-stave"  in  a  court  of  Philadelphia,  "to  get  bread  for  their 
families,"  and  for  499  of  them  to  return  to  their  families  disap- 


ON    THE    PRinES    OF    AMERICAN    LABOR.  413 

pointed  ;  nor  is  it  likely  that  an  ex-governor  of  any  state  will  shed 
unavailing  tears,  because  he  was  impoverished  by  the  hard  times 
of  that  era.  'J'he  president  and  his  secretary,  apparently,  did  not 
think  of  tliis;  they  do  not  seem  to  have  well  considered,  how  much 
it  is  worth  to  labor,  to  be  secure  of  employment ;  nor  weie  they 
well  advised  about  the  wages  of  labor,  under  the  tariff  of  1842,  as 
the  following  facts  will  show  :  — 

For  some  two  or  three  years  before  the  tariff  of  1842,  most  of  the 
manufocturers  of  the  country  were  obliged  to  compound  with  labor, 
at  low  wages,  in  hope  of  better  times,  or  suspend  operations. 

The  Hon.  Abbott  Lawrence,  in  his  second  letter  to  ihe  Hon. 
William  C.  Rives,  of  Virginia,  dated  Boston,  January  IG,  1846, 
says:  "  I  will  give  you  an  example  of  the  rate  of  wages  under  low 
duties,  and  under  the  tariff  of  1842.  In  1841-'2,  the  depression 
in  all  kinds  of  business  became  so  oppressive,  that  many  of  the 
manufacturing  establishments  in  New  England  were  closed,  and 
the  operatives  dismissed,  the  mechanical  trades  were  still,  and  ev- 
ery resource  for  the  laboring  man  seemed  dried  up.  In  the  city  of 
Lowell,  where  there  are  more  than  thirty  large  cotton-mills,  with 
from  six  to  sixteen  thousand  spindles  each,  it  was  gravely  consid- 
ered by  the  proprietors,  whether  the  mills  should  be  stopped.  It 
was  concluded  to  reduce  the  wages.  This  was  done  several  times, 
until  the  reduction  brought  down  the  wages  from  about  $2  to  SI. 50 
per  week,  exclusive  of  board.  This  operation  took  place  upon  be- 
tween 7,000  and  8,000  females  ;  the  mills  ran  on  ;  no  sales  were 
made  of  the  goods ;  the  south  and  west  had  neither  money,  nor 
credit;  and  finally,  it  was  determined  to  hold  out,  till  Congress 
should  act  upon  the  tariff.  The  bill  [tariff  of  1842]  passed,  and 
of  course  the  mills  were  kept  running,  which  would  not  have  been 
the  case  if  the  act  had  been  rejected  ;  and  now  the  average  wages 
paid  at  Lowell  —  taking  the  same  number  of  females  for  the  same 
service  —  is  $2  per  week,  exclusive  of  board.  Yet,  Mr.  Walker 
says,  labor  has  fallen.  Where  are  wages  of  labor,  I  ask,  lower  than 
they  were  in  1842  ?  Who  is  to  be  benefited  by  the  adoption  of  a 
system  that  gives  up  everything,  and  gives  no  reasonable  promise 
of  anything?" 

The  same  is  true  of  the  larjje  manufacturing  towns  of  Manchester 
and  Nashua,  New  Hampshire.  The  Hon.  Mr.  Ramsey,  of  Penn- 
sylvania, in  his  speech  on  the  tariff,  house  of  representatives  (see 
National  Intelligencer,  September  1,  1846),  represents,  that,  from 
1837  to  1842,  a  large  portion  of  the  miners  and  laborers  in  the 


414  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

minino-  reo-ions  of  that  state,  were  out  of  employment ;  that  the  la- 
borers  who  got  work,  received  only  from  S3.50  to  $4  a  week  — 
and  miners  only  from  $5  to  $6  —  generally  paid  in  goods,  equal  to 
15  or  20  per  cent,  discount ;  and  that  in  lS45-'6,  laborers  got 
from  $5  to  $6,  and  miners  from  $8  to  $10,  cash  —  average  increase, 
30  per  cent. 

This,  in  amount,  was  generally,  if  not  universally,  true  of  the 
manufacturing  establishments  of  the  country,  of  every  description  ; 
and  it  was  equally  true  in  every  department  of  life,  that  em])loys 
labor.  Employinent  was  never  wanting  under  tiie  tariff  of  1S42, 
and  wages  did  increase  —  an  average  of  full  25  per  cent,  higher 
than  they  were  before.  For  further  statistics  on  this  subject,  see 
note  below.* 

The  wages  of  labor  in  the  mechanical  trades,  on  railroads  and 
canals,  in  agriculture,  in  common  job-work  of  cities  and  towns,  and 

*  Everybody  knows  what  savings-banks  are  instituted  for,  viz.,  to  afford  to 
labor  a  secure  deposite  for  its  savings.  They  now  exist  in  many  parts  of  the  coun- 
try, and  are  a  great  blessing  to  the  laboring  poor.  There  are  two  items  in  the 
history  of  these  institutions  which  are  probably  better  evidence  of  the  employment 
and  prosperity  of  labor,  than  any  or  all  other  that  could  be  given,  viz.,  the  com- 
parative numberof  depositors  and  the  comparative  amount  of  deposites  in  a  course 
of  years.  In  the  state  of  Massachusetts,  the  banks  of  savings  are  obliged  by  law 
to  make  annual  returns  to  the  legislature,  of  which  the  following  are  quotations 
for  three  years  :  In  1841,  the  number  of  depositors  was  39,832  ;  the  amount  of  de- 
posites, $6,485,424.  In  1842,  depositors  41,102;  deposites  $6,675,878.  In  1845, 
depositors  54,256;  deposites  $9,214,954.  The  first  two  years  were  under  the  dis- 
astrous period  that  preceded  the  tariff  of  "42;  the  last  was  the  third  year  of  the 
operation  of  that  tariff.  The  comparison  is  instructive,  and  to  the  point.  The 
increase  from  J841  to  1842,  was  about  3  per  cent,  on  depositors,  and  about  3j  per 
cent,  on  amount  deposited.  The  difference  between  1842  and  1845,  was  about  32 
per  cent,  on  depositors,  or  nearly  II  per  cent,  per  annum;  and  about  38  per  cent, 
on  amount  deposited,  or  nearly  13  per  cent,  per  annum.  The  amount  of  deposites 
in  the  savings-bank  at  Lowell,  was,  in  1841,  $448,190;  in  1842,  $478,365;  in 
1843,  $462,650;  in  1844,  $591,910;  in  1845,  $730,890.  At  Portsmouth,  New 
Hampshire,  in  1842,  $220,636;  in  1846,  $336,960.  At  Saeo,  Maine,  in  1842, 
$29,667;  in  1846,  $48,157.  It  is  believed  that  ihe>e  facts  require  no  comment,  as 
it  is  well  known  for  whom  these  institutions  were  established,  and  what  classes  of 
persons  use  them.  The  details  of  ihese  statistics  for  about  thirty  banks  of  savings, 
will  be  found  in  Fisher's  National  Magazine,  for  March  and  June,  1846,  proving 
the  same  thins,  viz.,  that  bibor  was  never  so  prosperous,  and  never  laid  up  so 
much,  in  a  given  time,  as  under  the  tariff  of '42. 

The  following  is  from  the  same  masazine,  for  March,  1846  : — 

"  Within  the  past  year  200  houses  have  been  built  in  Pawtucket,  and  the  ad- 
joinins  villase  of  Central  Falls,  all  by  the  hands  employed  in  the  manufactories  of 
the  two  places,  some  of  which  have  cost  upward  of  $2,000. 

''The  deposites  in  the  Pawtucket  savings-bank,  amount,  on  an  average,  to  $70,000. 

"The  following  are  the  prices  paid  for  waxes,  in  the  years  1842  and  1845.  They 
all  relate  to  the  same  hands  who  were  employed  in  both  years :— 


ON    THE    PRICES    OF    AMERICAN    LABOR.  415 

in  every  pursuit  throughout  the  land,  in  the  two  periods  under  con- 
sideration—  the  former  universally  known  as  disastrous,  and  the 
latter  as  prosperous — are  too  well  known  to  those  concerned,  to 
require  certificates  from  other  authorities  ;  and  there  can  be  but 
one  voice  from  all  these  quarters,  which,  for  one  reason,  we  are 
sorry  to  say,  is  most  remote  from  verifying  the  statements  of  the 
president  and  his  secretary,  above  cited,  on  this  subject.  All  the 
world  know  it  is  not  so,  and  it  ought  not  to  have  been  necessary 
to  adduce  evidence  on  the  point.  But  such  are  the  facts,  whereas 
not  a  single  fact  was  cited  by  these  public  functionaries,  to  substan- 
tiate their  assertions. 

The  secretary  also  says:  "When  the  number  of  manufactories 
is  not  great,  the  power  of  the  system  to  regulate  the  wages  of  labor, 
is  inconsiderable ;  but  as  the  profit  of  capital  invested  in  manufac- 
tures is  augmented  by  the  protective  tariff,  there  is  a  corresponding 
increase  of  power,  until  the  control  of  such  capital  over  the  wages 
of  labor  becomes  irresistible." 

Wages  for  Dec.  1842.  Dec.  184.5.  "V\''ages  for  Dec.  1842.  Dec.  1845. 

Female  Weavers $1112       $17  03      Female  Weavers $11.30       $18  64 

"  "        1116         18  80      Engineer,  per  day...      133  175 

«  "        10  76         17  80      Machinist 133  175 

«  «        12  60         2185      Firemen  75  100 

«  "       13  32         17  27      Sparegirls,perweek..l8to2Is.        4  00 

"  Before  the  protective  duty  was  enacted,  the  best  workmen  could  only  obtain 
one  dollar  per  day  ;  the  same  men  now  receive  one  dollar  and  a  half  per  day." 

Another  important  item  of  evidence  on  this  subject  will  be  found  in  the  same 
magazine  for  May,  1846  :  — 

"  Mr.  R.  Fisher  :  Sir — In  answer  to  your  queries  on  the  subject  of  labor  in  the 
following  years,  we  state  as  follows  : — 
The  Price  of  Wages  per  Day,  for  Masons  and.  Laborers,  in  the  Month  of  May,  in 

the  fall  on- in  g  Years  : — 
1832.  .Masons,  13  shillings.    Laborers,  7  shillings. 
1835..       «         14        "  "         8         " 

1836..      «         17        "  "       10        "      After  the  great  fire  in  New  York. 

1837..      "         15        "  "        8        « 

1838..      "         13        "  «        7        " 

1839..      "        13        "  «        8        "     Great  expansion  of  the  currency. 

1840..      "         12        «  «        6        " 

1841..      "         12        "  "        7        " 

1842..      «         11        "  "7        " 

1843..      "         12        "  "        7        « 

1844..      "         13        «  "        8        « 

1845..      *<         14        "  «        8         « 

"In  addition  to  the  rise  in  the  wages,  from  1842  to  1845,  there  have  been  em- 
ployed from  50  to  75  per  cent,  more  men  than  there  were  from  1838  to  1842. 

"Joseph  Tucker,  Amos  Woodruff,.  ,,    ,      .      .     ,     „. 

«  Wm.  Tucker,  James  w..«  C  Mechanics  in  the  City 

"James  Harriot,  Samuei 


'IteiC       Wtlt      IIV/LIJ      *  K^JKjyj      i%J      A  VJT-fc., 

Woodruff,  i  „    ,      .      .     ,     , 
„,  r  Mechanics  in  the  C 

ZL  Oliver,    )        "f  ^'"^  Y'^^' 


41G  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

Here  is  a  double  assumption,  involving  two  untruths.  Tf  man- 
ufactures were  movopolies,  as  they  are  sometimes  falsely  called,  that 
is,  if  they  had  exclusive  privileges  —  for  nothing  else  can  be  a 
monoj)oly  —  then  there  might  possibly  be  some  foundation  for  such 
a  statement.  But  the  more  manufactories  are  encouraged,  multi- 
plied, and  extended,  under  a  protective  tariff,  and  the  more  capital 
there  is  vested  in  them,  so  much  greater  are  the  chances  of  labor, 
and  so  much  greater  is  its  relative  power.  When  the  manufactories 
are  few,  and  the  competition  between  them  small,  their  power  rela- 
tive to  labor  is  greater  ;  but  when  they  become  numerous  as  com- 
petitors, and  rich  in  capital,  their  rivalship  with  each  other  is  all  for 
the  advantage  of  labor.  In  the  former  case,  labor  pays  court  to 
them,  and  is  obliged  to  receive  terms:  in  the  latter,  labor  dictates 
terms,  and  becomes  the  object  of  courtship. 

The  effect  of  low  wages  is  to  demoralize,  to  debase,  to  de- 
grade man,  and  render  him  unfit  to  aspire  to  freedom,  and  unfit 
to  enjoy  it.  Working  ever  for  a  bare  subsistence,  and  hardly 
that,  without  hope  of  a  better  condition,  leaves  no  place  for 
pride,  self-respect,  and  ambition.  That  debasement  of  mind, 
which  is  everywhere  observable  among  the  laboring  classes 
of  Europe,  whose  task  is  hard,  and  whose  prospect  of  an  im- 
provement in  their  condition  is  hopeless,  is  the  necessary  effect 
and  uniform  concomitant  of  such  a  doom.  Reduce  those  de- 
pendent on  labor  in  the  United  States  —  which  comprehends  a  ma- 
jority of  the  people  —  to  such  low  wages,  by  the  establishment  of 
Free  Trade,  which  would  be  the  inevitable  result,  and  the  moral 
effect  would  be  the  same.  The  character  of  the  people  would  be 
entirely  changed.  The  goverimient  would  be  changed  —  all  would 
be  changed.  Labor  would  then  be  the  agent  of  j'oicer,  and  not 
an  indi pnident  agent. 

The  power  of  foreign  pauper  labor  over  the  labor  of  American 
freemen,  is  not  vested  in  itself,  but  in  the  arm  of  its  oppressors. 
It  is  a  mere  agent  of  the  latter.  Nor  can  that  power  be  abated, 
except  by  a  change  of  political  society  in  those  quarters,  for  the 
emancipation  of  labor.  So  long  as  political  society  is  the  same 
there,  and  the  same  here,  there  can  never  be  a  time  when  "  the 
protected  arts"  in  the  United  States,  "shall  have  acquired  such 
strength  and  perfection  as  will  enable  them  subsequently,  unaided, 
to  stand  up  against  foreign  competition."  No  matter  what  strength, 
no  matter  what  perfection  tliey  may  acquire,  they  will  never  be 
strong  enough,  never  perfect  enough,  to  employ  free  labor  at  a  fair 


ON    THE    PRICES    OF    AMERICAN    LABOR.  417 

price,  in  a  field  of  competition  with  tlie  same  arts  worked  by  forced 
labor  at  a  price  which  barely  supports  existence. 

The  question,  then  —  the  great,  practical,  momentous  question 
— is,  shall  European  capital  and  labor,  in  a  field  of  open  and 
Free  Trade,  be  permitted  to  bring  American  capital  and  labor,  that 
is,  American  society,  down  to  the  same  level  ?  Or  shall  American 
society,  by  the  American  government,  •jirotrct  American  capital 
and  labor,  and  maintain  the  position  to  which  the  cost  of  American 
freedom  has  elevated  them? 

The  great  batde  of  the  world  is  between  freedom  and  despotism; 
and  more  than  in  anything,  or  all  things  else,  the yjyrwz  under  which 
that  contest  is  now  carried  on,  is  between  European  capital  and 
labor  on  one  side,  and  American  capital  and  labor  on  tiie  other. 
On  this  pivot  turns  the  destiny  of  nations.  Sustain  the  position 
of  American  capital  and  labor,  that  every  man  may  be  secure  of  the 
fair  reward  of  his  exertions,  however  humble  his  birth  and  calling, 
and  freedom  will  prevail  all  the  world  over.  The  American  peo- 
ple, V7iifrd  and  resolved  in  this  great  emprise,  can  beat  the  world  — 
the  wlivh  world  —  and  crumble  into  dust  the  bulwarks  of  despotic 
sway.  But,  let  European  capital  and  labor,  in  the  hands  of  Eu- 
ropean despots,  PREVAIL  against  American  capital  and  labor,  for 
want  of  protection  to  the  latter,  and  there  is  an  end  of  freedom,  till 
another  cycle  of  ages,  with  its  sad  round  of  experience,  shall  burst 
the  chains  again,  and  they  who  succeed  shall  better  appreciate  their 
duty  and  their  chances. 

The  batde  for  American  freedom  was  only  begun  in  the  estab- 
lishment of  American  independence.  The  commercial  systems  of 
Europe  are  more  to  be  feared  than  all  the  power  of  European 
arms.  It  is  much  to  say,  yet  it  may  be  true,  that  a  perpetual  war 
would  be  less  expensive  and  less  perilous  than  the  effects  of  this 
occult,  silent,  insinuating,  all-pervading  power,  if  unresisted. 

27 


418       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 


CHAPTER   XXVII. 

THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM    ON    THE    INTERESTS 

OF    AGRICULTURE. 

Not  true  that  Agriculture  lias  no  Share  in  the  Benefits  of  a  Protective  System. — Facts  and 
Statistical  Evidence  on  this  Point. — Breadstuff^,  in  ordinary  Seasons,  cheaper  in  Europe 
than  in  the  United  States. — The  Effect  of  Indirect  Protection  of  Agriculture — Protec- 
tion of  Slave  grown  Staples — Slave  Labor  in  the  United  States  needs  Protection  more 
than  Free  Labor. — All  Nations  can  and  intend  to  supply  their  own  Mouths. — Great 
Britain  the  greatest  Exporter  of  Agricultural  Products,  of  any  Nation  in  the  world. — 
Evidence  of  William  Brown,  Esq.,  on  this  Point. — The  Importance  of  this  Fact  in  a 
System  of  Public  Economy. — Statistics  showing  that  Europe  is  Independent  of  the  Uni- 
ted States  for  Breadstuffs. — The  Problem  as  to  whether  American  Indian  Corn  will  find 
a  permanent  Market  in  Europe. — European  Agricultural  Labor  will  always  beat  Amer- 
ican Agricultural  Labor  in  Market,  because  of  its  Low  Price — The  Effect  of  a  Protec- 
tive System  in  sustaining  and  raising  Prices  of  Agricultural  Labor  and  Products. — 
Showing  of  the  Effects  of  certain  Items  of  the  Tariff  of  1846  on  the  Interests  of  Amer- 
ican Agriculture. 

The  influence  of  a  protective  system  on  agriculture,  has  been, 
in  no  small  degree,  already  set  forth  in  these  pages.  Nevertheless, 
it  is  a  point  of  too  much  importance  to  be  passed  over,  so  long  as 
other  evidence,  of  an  equally  impressive  character,  remains  to  be 
considered. 

It  is  sometimes  erroneously  supposed  and  maintained,  that  far- 
mers and  agriculturists  have  no  share  in  the  benefits  of  a  protective 
system.  If,  indeed,  what  is  thus  falsely  asserted,  were  so  far  true, 
as  that  they  should  receive  no  direct  protection,  it  will  yet  appear, 
that  the  protection  they  receive  indirectly,  under  such  a  system,  is 
not  only  most  important  to  them,  but  would  in  itself  be  an  abun- 
dant compensation  for  the  sacrifices  which,  it  is  alleged,  are  im- 
posed upon  them,  but  which,  however,  as  will  be  seen,  are  no  sac- 
rifices at  all.  But  it  will  appear  that  the  direct  protection  provided 
for  agriculturists,  under  the  system,  is  on  an  average  as  great,  or 
greater,  than  that  which  is  afforded  to  manufacturers  and  mechan- 
ics. For  example,  the  direct  protection  granted  by  the  tariff  of 
1842,  to  the  following  articles,  wool,  hemp,  beef,  pork,  hams,  bacon, 
cheese,  butter,  lard,  potatoes,  flour,  wheat,  and  raw  cotton,  was  an 
average  of  about  fifty  per  cent.,  which  is  at  least  equal  to,  and  some- 
what above,  the  average  protection  granted  to  any  other  class,  man- 
ufacturers, mechanics,  or  whatever;  and  protection  to  most  of  these 
products  of  agriculture  is  very  important,  when  the  crops  are  good 


ON    THE    INTERESTS    OF    AGRICULTURE.  419 

and  other  of  these  articles  are  abundant  in  all  parts  of  the  world. 
Before  the  potato-rot  fell  upon  Ireland,  an  impost  of  ten  cents  a 
bushel  could  not  keep  this  vegetable  from  being  imported  into  the 
United  States  in  considerable  quantities  ;  and  the  secretary  of  the 
treasury  estimated  an  increase  of  its  importation,  by  the  reduction 
of  the  duty  in  the  tariff  of  1842,  by  that  of  1846,  from  36  to  20 
per  cent.,  so  as  to  add  to  the  revenue  $150,000.  The  annual 
average  of  our  imports  of  wheat,  from  1S31  to  1844,  inclusive, 
was  425,442  bushels;  and  in  1837,  we  imported  4,000,000  of 
bushels,  and  2,389,102  bushels  in  excess  of  our  exports.  And 
the  aggregate  excess  of  exports  of  wheat  over  imports,  for  these 
fourteen  years,  was  only  5,065,390  bushels.  \_Sce  Fishe/s  Sa- 
tioiial  Magazine,  for  April,  1846.] 

The  importance  of  direct  protection  for  wheat  and  other  grains, 
will  appear  from  the  facts  that,  in  years  of  ordinary  plenty,  they 
are  cheaper  in  Europe  than  in  the  United  States,  and  that  the  cost 
of  transportation  from  Europe  to  our  ports,  is  less  than  from  the 
west  of  our  country  to  the  east.  The  average  price  of  wheat  per 
bushel,  at  the  following  places  in  Europe,  from  1830  to  1843,  in- 
clusive, viz.,  at  Dantzic,  was  91  cents;  at  Hamburg,  90  cents;  at 
Amsterdam,  99  cents ;  at  Antwerp,  98  cents  ;  and  at  Odessa,  64 
cents.  The  average  price  at  the  seaports  of  the  United  States,  for 
the  same  years,  was  $1.25.  The  cost  of  transportation  from 
Michigan  to  New  York,  is  30  cents  per  bushel ;  and  from  Europe, 
not  over  ten,  sometimes  down  to  six  cents.  From  the  Mediter- 
ranean, it  costs  from  12  to  16  cents  per  bushel.  The  average  cost 
of  transportation  of  wheat  from  the  western  country  to  New  York, 
may  be  put  down  at  3  to  1  of  the  cosl  from  Bremen  to  the  same 
point.  In  1836  and  '37,  years  of  short  crops  in  the  United  States, 
large  quantities  of  barley  were  imported  on  commission  for  brew- 
ers in  New  York,  Albany,  and  other  towns  on  the  Hudson,  at  a 
cost,  including  all  expenses,  of  55  cents  per  bushel,  when  the  mar- 
ket price  here  was  about  one  dollar;  and  large  quantities  of  rye 
were  imported  for  the  same  object,  at  a  cost  of  63  cents,  when  the 
price  here  was  $1.25.  [<See  National  Magazine,  for  January ^ 
1846,  pp.  709-'10.] 

Hence  the  importance  of  protective  duties  to  agriculture.  The 
years  of  famine  in  Europe  can  not  be  expected  to  continue.  Alas 
that  American  farmers  should  be  obliged  to  rely  on  such  a  cause 
for  a  market  and  good  prices  !  Providence  may  yet  force  us,  in 
our  turn,  to  go  to  Europe  for  bread.      As  already  seen,  though 


420  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

not  reduced  to  distress,  we  were  partly  supplied  with  bread  from 
that  quarter  in  1837,  by  reason  of  short  crops. 

The  indirect  effects  of  a  protective  system  in  sustaining  and 
raising  the  prices  of  agricultural  products  and  labor,  and  in  increas- 
ing the  demand  for  them,  assert  a  very  strong  claim  for  a  full  con- 
sideration. Tliis  is  more  important  and  more  effective  than  direct 
protection,  though  the  average  of  the  latter,  as  seen  above,  is  not 
exceeded  by  that  bestowed  on  those  diings  which  are  commonly 
supposed  to  be  the  chief  objects  of  protection. 

It  is  convenient  in  this  place  to  distinguish  between  those  prod- 
ucts of  American  agriculture  which  are  common  to  this  country 
and  all  otl)ers,  or  most  others,  with  which  we  trade,  and  those  not 
common.  Of  cour-e,  exotic  productions  which  we  do  not  raise  or 
produce  at  all,  do  not  come  within  the  scope  of  this  question;  and 
there  are  three  or  four  slave-grown  staples  of  considerable  impor- 
tance, which,  though  produced  in  some  other  countries,  occupy  a 
peculiar  position,  and  will  on  thnt  account  claim  a  separate  consid- 
eration, especially  cotton.  It  may  be  remarked,  however,  in  pas- 
sing, that  tobacco,  as  an  agricultural  product,  which  is  chiefly 
though  not  exclusively  a  slave-grown  staple  in  the  United  States, 
is  yet  essentially  benefited  by  protection  of  its  manufactured  forms. 
Rice,  as  an  American  product,  and  a  slave-grown  staple,  demands 
and  receives  protection.  Sugar  is  also  a  slave-grown  staple  ;  but 
it  requires  protection  only  as  a  manufaciured  article.  While  the 
prices  of  tiiis  article  are  reduced  by  protection,  as  before  shown, 
the  value  of  the  ao^ricultura!  labor,  in  raising  the  cane,  is  enhanced 
by  it  ;  so  also  the  labor  of  making  the  sugar,  as  it  is  done  by  the 
same  hands.  This  benefit  to  this  species  of  agriculture  is  proved 
by  the  fact  that  those  engaged  in  it  demand  protection.  JVothing, 
therefore,  of  the  slave-grown  staples  of  importance  remains,  except 
cotton,  which  is  considered  in  another  place. 

Slave-labor  invariably  demands  protection,  much  more  than  free 
labor,  in  all  its  work  that  is  common  to  free  labor,  because  the  for- 
mer is  not  only  more  expensive  for  a  given  amount  of  its  products, 
but  because  a  free  nian  works  for  himself,  while  a  slave  works  for 
a  master.  In  raising  cotton,  rice,  and  sugar,  slave-labor  has  no 
competitor  in  free  ;  and  in  cotton,  it  has  no  rival  anywhere,  except 
in  certain  foreign  parts,  which,  as  shown  elsewhere,  is  of  no  con- 
sequence. But  in  every  department  of  labor  performed  by  slaves 
in  the  United  States,  whether  in  agriculture,  manufactures,  or  me- 
chanics, which  has  a  rival  in  free  labor,  slave-labor  demands  pro- 


ON  THE  INTERESTS  OF  AGRirULTURE.         421 

lection  against  the  foreign  product  much  more  than  free  labor.  Tt 
can  not  subsist  permanenily  witliout  protection,  as  it  wouhl  in  the 
end  eat  up  itself,  and  expire  of  its  own  vis  ruirfla.  There  never 
was  a  greater  mistake  than  for  slaveholders  in  the  United  States 
to  go  for  Free  Trade.  In  economy,  tiieir  slaves  occupy  precisely 
the  position  of  the  ox.  horse,  and  mule,  of  the  northern  farmer. 
Nor  is  it  the  same  position  as  that  of  the  pauper-labor  of  Europe, 
which  raises  and  supports  itself  on  the  pittance  allowed.  Slaves 
are  more  expensive.  We  are  not  the  advocates  of  slavery.  We 
speak  as  an  economist.  Slavery  in  the  United  States,  without 
a  protective  system,  would  as  certainly  run  out,  extinguish  itself, 
as  the  sun  is  sure  to  rise  and  set,  except  so  far  as  it  may  be  de- 
manded for  the  production  of  those  staples  which  free  labor  can 
not  produce.  Under  a  system  of  public  economy  for  the  United 
States,  as  one  nation,  in  its  foreign  commercial  relations,  Uec  labor 
could  do  without  protection  much  better  than  that  of  slaves. 

But,  to  return  to  our  proi)osition,  that,  in  addition  to  the  benefits 
which  agriculture  derives  from  a  direct  piotection  of  its  products, 
it  is  also  benefited  even  more  essentially  and  more  considerably  by 
the  indirect  influence  of  a  general  and  comprehensive  protective 
system,  in  sustaining  and  raising  the  prices  of  its  products,  and 
consequently  sustaining  and  raising  the  prices  of  agricultural  labor. 
This  proposition  applies  not  only  to  those  agricultural  products 
which  we  raise  in  conmion  with  all  or  most  other  countries,  but  to 
those  which  are,  for  the  most  part,  and  some  of  which  are  alto- 
gether, peculiar  to  this  country. 

B^ut,  first,  in  regard  to  agricultural  products  which  are  common 
to  this  and  all  or  most  other  countries.  Bread-stuffs  and  those 
things  which  are  necessary  to  tnan's  subsistence,  are  common  to 
almost  all  countries  of  any  considerable  extent  of  territory.  Sav- 
ages generally  find  wherewithal  to  support  existence,  and  can  easily 
do  so,  where  there  is  enough  of  the  virtue  of  providence  among 
them.  But,  in  the  advanced  stages  of  civilization,  as  in  Europe 
and  some  other  parts,  a  country  can  not  be  found  where  the  peo- 
ple do  not  endeavor  to  raise  enough  of  bread-stuffs,  animal  food, 
and  other  esculents,  or  where  the  government  does  not  encourage 
the  raising  of  enough,  to  satisfy  all  the  mouths  that  are  in  it,  so  far 
as  necessaries  are  concerned.  All  Europe  is  abundantly  provided 
for  in  this  particular,  except  in  a  general  or  partial  failure  of  the 
crops,  against  which,  as  a  Providential  event,  no  human  foresight, 
care,  or  labor  can  be  fully  prepared.     Even  the  great  manufactur- 


422  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

ing  nation  of  Great  Britain  is  able,  and  for  the  most  part  intends, 
by  its  public  policy,  and  by  the  practical  operation  of  its  system 
of  society,  to  supply  all  its  own  mouths,  from  its  own  soil  and  fish- 
eries, with  the  necessaries  of  life  ;  and  it  has  vast  tracts  of  land 
not  yet  reduced  to  culture.  But  being  a  manufacturing  nation,  and 
requiring  custom  of  other  nations  for  her  manufactured  products, 
her  policy  is,  in  part,  to  suppress  agriculture  at  home  by  not  cul- 
tivating all  her  soil,  so  as  to  keep  up  appearances  of  a  reciprocal 
exchange  with  her  customers.  But  it  will  be  found  that  the  amount 
of  the  raw  agricultural  produce,  which  she  is  capable  of  raising  at 
all,  imported  or  bought  by  her,  is  trifling;  and  that  the  amount  of 
her  own  agricultural  produce  exported  in  the  forms  of  her  manu- 
factures, is  many  times  in  excess  of  all  that  she  imports  in  the  raw 
state  for  purposes  of  food.  The  following  statements  are  to  this 
point : — 

William  Brown,  Esq.,  a  British  Free-Trader  and  merchant,  in 
his  letter  to  John  Rolph,  Esq.,  a  landliolder,  which  appeared  in 
the  "  Economist,"  a  British  Free-Trade  journal,  of  November  15, 
1845,  says  :  "  Paradoxical  as  it  may  appear,  I  think  Great  Britain 
is  the  largest  grain-exporting  country  in  the  world,  although  it  is 
impossible  to  estimate  accurately  what  quantity  of  grain,  &c.,  is 
consumed  in  preparing  ^£50, 000, 000  [$242,000,000]  value  of  ex- 
ports [manufactured],  by  which  you  [landlords]  so  greatly  benefit. 
It  is  placed  in  the  laboratory  of  that  wonderful  intellectual  machine, 
man,  which  gives  him  the  physical  power,  aided  by  steam,  of  con- 
verting it  into  broadcloths,  calico,  hardware,  &c.  ;  and  in  these 
shapes  your  wheats  find  their  way  to  every  country  in  tlie  world. 
.  .  We  are  dependent  on  foreigners  for  using  our  wheat  in  the 
shape  of  broadcloths,  &c.  ;  and  1  wish  we  were  more  so.  .  .  You 
fancy  other  nations  are  untaxed,  and  l)ave  no  national  debt.  Pray 
point  them  out.  I  think  you  will  find,  on  inquiry,  that  the  taxa- 
tion of  this  country,  taking  into  view  its  wealth  and  ability  to  pay, 
is  as  light  as  in  any  country  I  know,  even  in  the  United  States. 
Indeed,  I  have  been  much  astonished  at  the  burdens  which  some 
of  the  stales  have  to  bear,  and  in  part  from  a  direct  land-tax.  .  . 
You  speak  of  how  small  an  amount  of  value  in  bread  is  consumed 
by  the  working  classes,  adding  that,  if  the  j)rice  were  lower,  it 
would  also  take  away  rent  altogether  ;  but  you  forget  beef,  pork, 
mutton,  milk,  butter,  cheese,  potatoes,  &c.,  and  that  rent  is  not  a 
large  portion  of  the  cost.  If  wheat,  the  most  convenient  article 
for  transport,  is  a  little  cheaper,  other  articles  of  agricultural  prod- 


ON    THE    INTERESTS    OF    AGRICULTURE.  423 

uce  would  advance,  under  a  prosperous  trade.  Any  wheat  that 
would  come  here,  would  only  help  to  keep  at  home  our  100,000 
human  machines  [who  annually  emigrate],  and  sustain  our  400,000 
annual  increase,  and  again  be  sent  away  in  the  shape  of  the  prod- 
ucts of  our  industry.  .  .  The  fact  is,  instead  of  keeping  our  peo- 
ple at  home  to  manufacture  for  the  rest  of  the  world,  and  be  your 
best  customers  at  your  own  door  for  the  products  of  the  soil,  our 
anti-commercial  policy  is  forcing  them  to'  emigrate,  to  seek  work 
elsewhere  ;  and  other  nations  are  employing  their  hands  to  do  what 
we  could  have  done  better  for  them,  and  at  a  lower  price.  Sup- 
pose we  imported  all  the  wheat  required  for  their  use  :  consider 
the  amount  of  wages  [of  the  manufacturing  operatives]  that  would 
reach  the  agriculturist,  directly  or  indirectly,  for  other  descriptions 
of  your  produce,  independent  of  wheat.  Nor  need  you  be  afraid 
of  the  United  States.  Their  population  is  increasing  still  more 
rapidly  than  that  of  Europe,  and  their  growth  of  wheat  is  not  ex- 
cessive. In  1843,  it  was  but  12,500,000  quarters  ;  in  1844,  it 
was  under  12,000,000  ;  of  Indian  corn,  in  1843,  it  was  62,500,000, 
and  in  1844,  only  53,000,000  of  quarters.  You  are  aware  that 
our  growth  of  wheat  is  estimated  at  18,000,000  of  quarters  ;  and 
of  all  kinds  of  grain,  beans,  &c.,  60,000,000.  .  .  It  is  obviously 
our  true  policy  to  increase  our  trade  with  other  nations.  .  .  With 
the  advantages  we  have  in  climate,  capital,  security  for  property, 
intelligence,  machinery,  improved  agricultural  implements,  and 
above  all,  in  the  immense  and  cheap  supply  of  the  moving  power, 
coal,  we  can  afford  to  give  higher  prices  for  agricultural  produce, 
to  sustain  the  rent-rolls  of  the  landlords,  and  maintain  England  as 
the  most  powerful  and  prosperous  kingdom,  and  the  principal  work- 
shop of  the  world.  .  .  I  have  shown  you,  that  the  introduction  of 
our  manufactures  into  other  countries,  is  the  medium  through  which 
we  export,  and  obtain  high  prices  for  your  wheat  and  other  agri- 
cultural productions." 

There  is  one  great  principle  or  doctrine  of  public  economy  dis- 
closed in  the  above  extract,  which,  in  a  subsequent  part  of  this 
chapter,  is  more  fully  elucidated,  and  which,  vital,  important,  and 
all-pervading  as  it  is,  in  every  practical  system,  has  not  even  been 
recognised  by  the  st;mdard  economists  of  the  age.  It  will  be  seen, 
after  reading  the  above,  that  we  refer  to  the  incorporation  of  agri- 
cultural labor  and  products  with  the  products  of  n)anufacture.  No 
system  of  public  economy  can  begin  to  be  what  it  ought  to  be,  that 
overlooks  this  comprehensive  element.     There  is  no  other  that 


424  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

enters  more  essentially,  or  pervades  more  thoroughly,  the  opera- 
tions of  the  commercial  world,  as  they  affect  this  branch  of  knowl- 
edge ;  and  no  one,  left  unconsidered,  that  would  lead  to  so  great 
a  defect  of  a  system.  It  is  impossible,  indeed,  to  understand  the 
true  economy  of  any  great  nation,  without  understanding  this. 

But  the  particular  purpose  for  which  we  have  here  introduced 
the  above  extracts,  is  to  call  attention,  by  such  incidental  evidence 
—  the  more  conclusive  because  it  is  incidental  —  to  the  competen- 
cy, even  of  Great  Britain,  to  feed  her  own  mouths,  where  no  ex- 
traordinary events  of  Providence,  as  by  the  failure  of  the  potato 
and  other  crops  in  1845  and  1S4G,  should  disappoint  human  cal- 
culations. Her  usual  production  of  bread-stuffs  is  but  a  little  short 
of  her  own  wants. 

But  Europe  is  empliatically  the  vvheatfield  of  the  world.  With 
a  superficial  area  of  3,650,000  square  miles,  four  sevenths  of  which, 
according  to  M'Culloch,  are  adapted  to  the  cultivation  of  wheat, 
including  all  the  densely-peopled  regions,  and  with  a  superabun- 
dance of  laborers  to  work  at  wages  from  six  to  twelve  cents  a  day, 
with  an  ordinary  product  of  that  part  of  the  world,  the  wants  of  Great 
Britain  are  not  likely  to  be  without  supply  at  prices  which  no  Amer- 
ican can  or  will  work  for.  The  tables  in  the  note  below  will  give 
some  instruction  on  this  point.* 

It  is  stated  above  that  Great  Britain  exports  many  times  of  her 
own  agricultural  products,  in  excess  of  what  she  imports,  for  pur- 

*  Importaiio4s  of  Wheat  into  Great  Britain,  from  the  principal  Wheat  Couvtrien, 

far  18^1,  1842,  and  1843,  in  Bushels,  together  with   the  Sum  total  from  each 

Country. 

Countries.  1841.  1842.  1843.  Total. 

Russia 498,205  1,821,688  269,368  2,.592,261 

Denmark 1,9:5,279  617,656  565,248  3,098,183 

Prussia 7,134,400  5,938,065  5,311,000  18,383,465 

Germany 5,295,674  1,626.172  1,027,224  7,949,070 

Holland 815,964  73,979  6,864  8S'6,507 

France 1,643,932  4,216,100  29,248  5,889,280 

Italy  and  Islands 901,600  4,878,597  24,840  5,805,037 

North  Am.  Colonies..   2,333,354  3,729,690  2,790,504  6,853,548 

United  States 1,107,840  1,195,873  749,601  3,053,278 

Other  Countries 866.8.59  1,816,340  272,407  2.955,606 

These  tltree  years,  1841,  1842,  and  18)3,  were  the  years  of  the  largest  importa- 
tions of  breadstuffs  into  Great  Britain,  averaging  18,300,000  bushels;  wherea.s, 
the  average  from  1829,  to  1843,  including  fifteen  years,  was  only  10,964,896  bushels. 

It  is  Kenerally  allowed,  however,  that  Great  Britain  ordinarily  rcqtiirts  an  aver- 
age annual  supply  of  wheat  from  other  countries,  of  about  15,000,000  of  bushels. 
or  1,500.000  quarters,  which  is  about  one  twelfth  of  her  own  product,  as  staled  by 
Mr.  Brown,  above.  The  proportion  of  this  supply  from  the  United  States,  accord- 
ing to  the  above  table,  is  about  one  twentieth. 


ON    THE    INTERESTS    OF    AGRICULTURE.  425 

poses  of  food.  As  Mr.  Brown  says,  there  can  be  no  accurate  es- 
timate on  such  a  proposition.  The  Hon.  Andrew  Stewart,  M.  C. 
of  Pennsylvania,  has  proved  that  we  buy  of  Great  Britain  at  least 
eight  dollars'  worth  of  her  agricultural  products,  in  the  forms  of 
her  manufactures,  to  one  dollar's  wortii  vvlii(  j)  she  takes  of  us, 
other  than  cotton  and  tobacco.  Her  average  annual  import  of 
wheat,  from  all  parts  of  the  world,  does  not  probably  exceed  the 
cost  of  $12,01)0,000;  while  her  export  of  nianufactures  is  stated 
by  Mr.  Brown,  above,  at  $242,000,1)00  —  it  is  more  than  that, 
indeed.  One  half  of  this  at  least,  that  is,  $1  21,000,000,  as  proved 
by  Mr.  Stewart,  is  made  up  of  her  agricultural  products,  which  other 
nations  buy  of  her.  Well  might  Mr.  Brown  say  that  Great  Britain 
is  the  largest  grain-exporting  country  in  the  world. 

Of  course,  no  one  will  pretend  that  the  present  almost  famine  in 
Europe  (in  1S47)  establishes  any  rule  on  this  subject.  Tlie  four 
sevenths  of  the  soil  of  Europe,  which  is  adapted  to  the  cultivation 
of  wheat,  is  about  equal  to  the  area  of  the  whole  United  States, 
exclusive  of  Texas  and  Oregon.  Only  about  one  fourth  of  this, 
lying  in  the  middle  and  northwestern  states  and  territories,  can  be 
relied  upon  for  a  surplus  production  ;  and  very  little  more  is  adapted 
to  wheal.  It  is  remarkable  that  the  exports  of  wheat  and  flour 
from  the  United  Stares  have  not  materially  increased  for  half  a 
century.  The  wheat-crop  of  the  United  States  in  1840,  was 
84,823,000  bushels  ;  and  in  1 844,  it  was  95,607,000  bushels.  For 
fourteen  years  previous  to  1846,  the  average  annual  export  of 
wheat  from  the  United  States,  to  all  parts  of  the  world,  was  5,505,- 
000  bushels;  in  1836,  only  805  bushels;  in  1838,  41,475  bushels  ; 
in  1837,  we  imported  4,000,000  bushels:  deduct  the  imports,  and 
the  average  of  fourteen  years  was  about  5,000,000.  What  is 
this  to  the  whole  product  of  nearly  one  hundred  millions  of  bushels, 
all  which  found  a  home  market,  except  the  above  fraction  of  a  little 
more  than  one  twentidh  ? 

It  will  be  found  it  was  never  expected  that  Great  Britain  would 
be  supplied  with  bread-stufl's  from  the  United  States  in  case  of  the 
abolition  of  the  corn-laws,  from  the  facts  stated  in  the  note  below.* 

France  is  virtually  independent  in  the  production  of  her  bread- 
stuffs,  as  will  appear  from  the  fact  that  the  aggregate  value  of  her 
imports  of  grain  and   flour,  from   1833  to   1840,  inclusive,  was 

•  In  1840,  ttie  British  government  called  upon  their  consuls,  at  some  of  the  prin- 
cipal marts  (if  the  corn-trade,  to  inform  them  what  amount  of  ?rain  could  be  sent 
to  the  English  market  in  case  the  English  duty  were  reduced  to  a  nominal  sum. 


423       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

$25,941,758,  and  of  her  exports  $24,115,751,  the  excess  of  im- 
ports for  the  whole  term  of  eight  years,  being  only  $825,997. 

Havino-  shown  that  Europe  is  the  granary  of  the  civilized  world 
—  at  least  a  sufficient  one  for  itself  in  ordinary  times  —  and  that  it 
is  competent  to  supply  all  mouths  in  its  own  domain,  it  will  be  per- 
tinent to  our  present  aim  to  exhibit  the  comparative  prices  of  bread- 
stuffs  in  Europe  and  in  the  United  States,  taking  wheat  as  the 
standard  for  a  sufficient  term  of  years  to  decide  in  which  of  these 
two  quarters  agricultural  labor  is  best  rewarded.  The  subjoined 
tables  and  facts  are  from  the  Hon.  Charles  Hudson's  speech,  de- 
livered in  Congress,  February  26,  1846,  to  whose  labors  we  are 
indebted  for  much  information  on  this  subject.* 

The  substance  of  their  replies  will  be  seen  in  the  following  table,  submitted,  with 
their  report,  to  parliament,  in  1841 : — 

Bushels.  Bushels. 

St.  Petersburg 1,540,000    Stettsie 2,000,000 

Liebau 240,000    Memel 47,712 

Warsaw 2,400,o00    Hamburgh 4,304,000 

Odessa 1,200,000    Elsinore '. 1,400,000 

Stockholm 8,000    Palermo 1,600,000 

Dantzic 2,520,000  ,  

Konigsburg 520,000        Total 17,779,712 

From  these  twelve  ports  it  appears  that  a  supply  of  17,779,712  bushels  of  wheat 
could  be  obtained  annually;  and  it  further  appears,  that  7,298,000  bushels  of  rye, 
6,820,500  bushels  of  barley,  and  6,445,700  bushels  of  oats,  could  be  supplied.  In 
this  list  is  not  included  Riga,  Rotterdam,  Antwerp,  and  several  other  important 
piorts  for  the  corn-trade. 

The  above  promises  of  supply  are  more  than  8,000,000  of  bushels  in  excess  of 
the  annua]  average  of  imjiorts  of  foreisrn  corn  into  Great  Britain,  from  1829  to 
J843,  inclusive,  15  years,  and  of  course  demonstrate  an  absolute  independence,  as 
to  any  necessary  supplies  from  the  United  States. 

•  "  The  following  table  will  show  the  prices  of  wheat  per  bushel  in  the  princi- 
pal marts  of  trade  on  the  continent  of  Europe,  from  1830  to  1843,  inclusive  : — 

1830 

1831 1.] 

1832 

1833 

1834 

1835 

1836 

1837 

1838 , 

1839  

1840 

1841 

1842 

1843 

Average 91  90  99  98  64 


Daiiizic. 

Hamburg:. 

Amsterdam. 

Antwerp. 

Odessa 

$1.07 

$0.93 

$1.13 

$0.95 

$0.68 

.     1.18 

1.19 

1.15 

1.07 

71 

93 

90 

1.10 

90 

62 

83 

70 

89 

55 

61 

70 

67 

66 

50 

77 

61 

65 

70 

68 

57 

70 

79 

76 

70 

52 

73 

76 

81 

99 

50 

94 

79 

1.20 

1.48 

65 

96 

1.15 

1.33 

1.37 

79 

.     1.07 

1.30 

1.11 

1.48 

71 

,     1.23 

99 

1.09 

1.45 

74 

.     1.10 

1.11 

1.11 

95 

65 

76 

82 

78 

76 

48 

ON    THE    INTERESTS    OF    AGRICULTURE.  427 

It  appears,  therefore,  from  the  foregoing-cited  facts,  first,  tliat, 
according  to  Mr.  Brown,  Great  Britain  exports  far  more  agricul- 
tural products  than  any  other  nation  in  the  world,  in  the  guise  of 
her  manufactures,  which  is  undoubtedly  true  ;  secondly,  that  the 
ordinary  amount  of  her  imports  of  bread-stuffs  is  only  about  one 
twelfth  of  her  own  products,  which  goes  forth  again  to  all  the 
world  in  her  manufactured  exports,  as  only  a  small  fraction  of  her 
exports  of  the  products  of  agriculture  in  the  same  forms  ;  thirdly, 
that  more  than  one  half  of  Europe,  and  not  more  than  one  fourth 

"Here  we  have  the  prices  of  wheat,  at  five  great  marts  of  the  wheat-trade,  for 
14  years,  showing  a  general  average  of  88  cents  per  bushel. 
"  The  prices  at  our  own  seaports  during  the  same  period,  run  as  follows  : — 

In  1830 $1.15  In  1837 $1.83 

1831 1.18  1838  1.54 

1832 1.15  1839 1.42 

1833 1.13  1840 1.10 

1834 1.08  1811 1.03 

1835 1.19  1842 1.16 

"1836 1.44  1843 1.00 

"The  general  average  of  the  aforenamed  prices  is  $1.25;  being  37  cents  more 
than  the  average  per  bushel  at  the  aforementioned  ports  on  the  Black  sea  and 
Baltic.  This  shows  demonstratively,  that,  in  the  first  cost  of  the  grain,  we  are  not 
able  to  come  into  fair  competition  with  trans-atlantic  wheat-srowers.  And  how  is 
it  with  reference  to  freight  ?  By  official  documents  laid  before  parliament,  it  ap- 
pears that  the  freiaht,  on  the  highest  calculation,  can  not  exceed,  on  an  average, 
13  cents  per  bushel.  By  the  report  of  the  Hon.  Mr.  Ellsworth,  commissioner  of 
patents,  laid  before  Congress  in  1843,  where  he  examines  this  subject  somewhat 
minutely,  it  appears  that  the  average  freight  from  New  York  to  Liverpool  is  35 
or  36  cents  per  cwt.  We  can  not  estimate  wheat  al  less  than  56  pounds  per 
bushel;  and  hence  the  freight  must  amount  to  17  or  18  cents  per  bu>hel.  The 
difference  in  the  freight  and  first  cost  would  make  a  balance  against  us  of  41  cents 
per  bushel.  But  as  the  year  1837  was  one  of  uncommonly  high  prices  in  this 
country,  I  will  omit  that  year  in  my  estimate,  which  will  reduce  this  balance  down 
to  about  36  cents;  and  from  this  I  will  deduct,  for  the  diflerence  of  exchange,  10 
cents,  which  will  bring  the  difference  down  to  26  cents  per  bushel. 

"The  English  consul,  writing  from  Odessa,  at  the  close  of  1842,  says:  Under 
present  circumstance.",  extraordinary  low  freight  and  favorable. exchange,  a  ship- 
ment of  the  best  wheat  could  now  be  made  and  delivered  in  England  on  the  fol- 
lowing terms,  viz. : — 

First  Cost 22s.  6d.  per  quarter 

Charge  of  loading 2     5  " 

Freight 6     7  " 

Insurance  and  Factorage  in  England 4     0  " 


Total 35     6  " 

"This  reduced  to  our  currency  would  amount  to  97  cents  per  bu.shel  delivered 
in  England.  And  in  1843  there  was  a  still  further  reduction  :  so  that  wheat  from 
the  Baltic  could  be  delivered  in  England  without  duty  at  87  cents,  and  from  the 
Black  sea  at  78  or  80  cents  per  bushel;  a  price  much  less  than  our  wheat  could 
be  purchased  at  in  our  own  ports." 


428       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

of  the  United  States,  exclusive  of  Texas  and  Oregon,  is  adapted 
to  the  cuhure  of  wheat;  fourthly,  that  the  wages  of  agricultural 
labor  in  Europe  are  not  over  one  fourth  of  the  wages  of  the  same 
kind  of  labor  in  the  United  States  ;  fifthly,  that  the  average  price 
of  wheat  in  Europe,  for  a  course  of  years,  and  with  ordinary  crops, 
sufficient  to  establish  a  general  rule,  is  but  a  little  in  excess  of  two 
thirds  of  the  average  price  in  the  United  States,  under  like  circum- 
stances ;  sixthly,  that  the  cost  of  transportation  from  the  wheat- 
growing  countries  of  Europe  to  those  parts  where  their  surpluses 
are  in  request,  is,  by  a  very  large  fraction,  less  than  the  cost  of 
carrying  from  the  United  States  to  the  same  markets  ;  and  seventhly, 
that  the  exports  of  wheat  from  the  United  States  have  not  mate- 
rially increased  for  the  last  fifty  years. 

We  are  aware  it  is  thought  by  many  that  Indian  corn  will  here- 
after be  the  great  export  of  bread-stuffs  from  the  United  States  to 
Europe.  That,  however,  is  yet  not  only  an  unsolved  problem,  but 
one  at  least  of  a  dubious  result.  Mr.  Brown,  cited  above,  says: 
•*  I  am  afraid  we  could  not  get  a  very  large  supply  of  Indian  corn, 
as  the  bulk,  compared  with  the  value,  would  make  it  a  very  ex- 
pensive article  of  import."  The  demand  for  it,  in  1847,  by  starv- 
ing millions,  is  no  guide  for  the  future.  It  is  the  interest  and  policy 
of  all  nations  to  supply  themselves  with  bread-stuffs  from  their  own 
domains  as  far  as  possible  ;  atid  there  is  no  part  of  the  world  better 
fitted,  or  better  able  to  do  it,  than  Europe.  It  n)ay  therefore  be 
predicted  that  this  expectation  of  finding  a  market  in  Europe  for 
our  Indian  corn,  to  any  great  extent,  will  be  turned  into  disap- 
pointment. The  question  is  simply,  whether  Europe  will  supply 
its  own  mouths,  as  it  ever  has  done;  and  there  is  little  doubt  that 
it  will,  in  years  of  good  crops.  But,  however  well  pleased  the 
starving  people  of  Great  Britain  and  Europe  may  be  with  our  In- 
dian corn,  when  Providence  has  cut  off"  their  crops,  it  is  morally 
certain,  when  they  are  blessed  with  good  crops  again,  that  they  will 
not  be  customers  to  American  labor  to  fill  the  mouths  which  can 
be  fed  for  one  half  or  one  fourth  the  cost  by  European  labor.  It 
is  the  comparative  cheapness  of  European  labor  that  will  necessa- 
rily and  for  ever,  in  ordinary  times,  exclude  American  bread-stuffs 
and  other  esculents,  for  the  most  part,  from  the  European  market. 
Even  if  the  wages  of  American  labor  should  be  brought  down  to 
the  same  level  with  those  of  Europe,  still  the  difficulties  of  obtain- 
ing the  European  market,  to  any  considerable  extent,  for  the  prod- 


ON    THE    INTERESTS    OF    AGRICULTURE.  429 

ucts  of  American  agriculture,  which  are  common  to  both  parts, 
would  be  insuperable.      It  can  never  be  relied  upon. 

The  question,  then,  arises,  where  is  American  agricultural  labor 
to  look  for  an  adequate  and  secure  reward  ;  and  where  are  Ameri- 
can agricultural  products,  common  to  Europe  and  other  countries, 
to  find  a  permanent  and  reliable  market,  that  will  be  remunerative 
to  the  parties  concerned?  This  is  the  question,  and  the  great 
question,  which  can  be  answered  only  by  a  consideration  of  the 
effects  of  a  protective  system  on  these  interests.  The  effects  of 
direct  protection,  in  these  particulars,  have  already  been  consid- 
ered. It  remains  to  notice  its  indirect  effects,  which  are  more 
comprehensive  and  more  important.  To  avoid  repetition,  as  far 
as  possible,  we  must  take  leave  to  refer  to  chapter  xxv.,  for  a  con- 
densed view  of  cumulative  evidence  on  this  point.  All  that  is  there 
said  of  the  reciprocal  influence  and  benefits  of  new  arts  and  new 
pursuits,  which  a  protective  system  calls  into  being;  of  their  influ- 
ence and  benefits  on  all  pre-existing  arts  and  pursuits;  and  of  the 
aggregate  influence  and  benefits  of  all  arts  and  all  pursuits  on  each 
and  every  other  under  such  a  system,  belongs  to  this  branch  of  the 
suhject.  Much  is  there  exhibited  of  the  benefits  accruing  to  agri- 
culture from  this  system,  which  it  is  unnecessary  to  repeat  here. 
But  still,  little  more  than  glimpses  of  these  benefits  are  there  pre- 
sented. They  consist  of  two  principal  classes  :  first,  in  a  protec- 
tion of  American  agricultural  labor  from  being  forced  into  a  com- 
petition  with  the  low-priced  labor  of  the  same  kind  in  Europe  and 
other  foreign  parts  ;  and  next,  in  creating  a  home  market  for  Amer- 
ican agricultural  products,  and  in  securing  for  them  better,  firmer, 
and  more  reliable  prices  :  thereby  sustaining  and  enhancing  the 
value  of  American  agricultural  labor  and  capital. 

It  is  manifest,  that  when  the  products  of  American  agricultural 
labor  are  brought  into  a  free  and  open  market  with  the  products 
of  European  and  other  foreign  labor  of  the  same  kind,  the  labor 
itself  is  in  the  same  market;  and  that  the  tendency  is  to  reduce 
the  price  of  American  labor  to  that  of  foreign  labor.  We  say  the 
tendency,  and  that  tendency  will  be  instantly  felt  on  the  side  of 
American  labor.  We  have  before  indicated  the  reason  why  Amer- 
ican labor,  in  such  a  case,  will  not  come  entirely  down  to  the  old 
level  of  Euroj)ean  labor.  The  water  of  one  cistern  which  is  higher 
than  that  of  another,  will  raise  the  other,  by  being  let  off  into  it, 
before  both  come  to  a  common  level.  If  the  capacity  of  the  two 
cisterns  were  equal,  the  common  level  would  be  found  midway  of 


430       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

the  difFerence.  But  the  American  cistern  is  a  very  snnal]  one  com- 
pared with  all  the  rest  of  tiie  world,  and  being  let  off,  would  fall 
immensely,  while  the  other  would  scarcely  seem  to  rise. 

American  labor  can  not  tell  why,  for  it  does  not  understand  the 
subject,  except  instinctively  ;  but  it  is  distressed  the  moment  it  is 
forced  into  any  degree  of  competition  with  European  and  other 
foreio-n  labor,  for  want  of  adequate  protection.  First,  there  is  a  less 
active  demand  for  American  labor  in  such  a  case  ;  and  next,  its 
prices  begin  to  fall.  It  is  embarrassed  to  tell  why,  unless  it  be  well 
instructed  on  the  subject,  and  has  thought  of  it  much.  But  it  feels 
it,  knows  it,  is  distressed  by  it.  The  effect  is  as  certain  to  follow 
the  cause,  as  the  sun  is  to  rise  at  his  time  and  place.  It  is  a  com- 
mercial result,  enforced  by  the  operation  of  a  well-known  commer- 
cial principle,  to  wit,  competition  in  trade. 

But,  as  the  interests  of  American  agricultural  labor  can  not  be 
separated  from  those  of  American  agricultural  capital,  and  as  the 
value  of  each  is  determined  by  the  prices  which  their  joint  products 
are  able  to  command  in  the  market,  it  matters  little  which  of  these 
three  things,  the  labor,  or  the  capital,  or  their  products,  is  under 
consideration,  for  the  purpose  now  in  view.     The  inquiry  regard- 
ino-  each  leads  to  the  same  end.     Everybody  knows  how  quick 
the  farming  interests  feel  the  benefits  of  a  new  manufactory,  or  a 
new  manufacturing  village  or  town,  that  has  sprung  up  in  the  midst 
of  them,  under  a  protective  system.      The  farms  instantly  rise  in 
value ;  some  of  them,  in  the  neighborhood,  are  turned  into  gardens, 
the  most  profitable  species  of  husbandry  ;  a  new  and  lively  market 
is  opened  for  agricultural  products  ;  agricultural  labor  is  in  greater 
demand,  and  better  paid  ;  its  products  command  a  higher  price  ; 
and  in  this  way,  the  increase  of  manufacturing  establishments  over 
the  face  of  the  country,  under  the  fostering  care  of  the  same  sys- 
tem, diffuses  the  same  benefits  over  the  agricultural  interests  of  the 
whole  land.     The  operation  is  simple,  and  may  easily  be  explained. 
In  the  first  place,  the  market  is  brought  home  to  the  door  of  agri- 
culture, instead  of  being  remote  in  a  foreign  land.     Next,  the  wants 
supplied,  and  the  profits  made,  by  the  sale  of  agricultural  products, 
are  supplied  and  made  at  home,  and  the  capital,  on  both  sides,  is 
in  the  country,  stays  here,  is  used  here,  and  by  being  turned  over 
and  over  again,  in  different  hands,  to  different  productive  ends,  is 
the  cause  of  ceaseless  and  cumulative  wealth  among  all  parties  ; 
whereas,  if  the  same  wants  had  been  supj)lied   from   abroad,  this 
capital  would  have  gone  abroad,  and  been  lost  to  the  country  for 


ON    THE    INTERESTS    OF    AGRICULTURE.  431 

ever.  In  all  these  transactions,  and  as  a  consequence,  be-fides  the 
benefits  to  the  agricuhural  interests,  and  besides  the  activity  and 
profit  which  they  afford  to  every  species  of  business  connected  with 
them  —  and  it  extends  to  all  kinds  of  business — there  are  constantly 
growing  up  in  the  country,  those  great  interests,  with  increasing 
amounts  of  capital,  which,  having  been  first  the  cause  of  these  wide- 
spread and  universal  benefits,  are  the  perpetual  nurturers  of  the 
same,  imparting  benefits  to  all,  and  receiving  benefits  from  all.  It 
is  the  creation  of  a  new  and  countless  family  of  interests,  allied  to 
each  other,  and  all  profiting  by  the  active  operations  of  which  they, 
in  such  connexion,  and  by  such  reciprocal  influences,  are  the  cause. 
The  country  and  all  parties  are  enriched.  Thirdly,  it  increases 
the  diversity  of  labor,  brings  new  customers  to  every  vocation,  and 
makes  each  more  profitable  by  diminishing  relatively  the  number 
engaged  in  it.  Fourthly,  one  of  the  chief  benefits  of  such  a  system 
to  agriculture,  is,  that  it  appropi'iates  to  itself  thereby,  what  would 
otherwise  be  expended  in  the  cost  of  transportation  of  its  products 
to  a  foreign  market,  by  having  a  home  market.  The  practical  oper- 
ation o[  a  protective  system,  for  the  increase  of  prices  of  agricultural 
products,  may  be  thus  explained  :  All  agricultural  products  are 
comparatively  gross  and  heavy,  and  consequently  more  expensive 
in  being  carried  to  a  remote  market.  Suppose  the  cost  of  trans- 
portation from  the  remote  west  to  the  eastern  market  be  100  per 
cent.  In  other  words,  that  the  products  are  only  worth  Iia/f  as 
much  in  the  place  where  they  are  grown,  as  in  the  place  where 
they  are  consumed.  Add  as  much  more  for  the  expense  of  deliv- 
ery in  a  foreign  market,  and  the  price  to  the  producer  is  reduced 
to  one  third  of  the  price  at  the  place  of  destination.  But  bring  the 
market  half  way  toward  the  producer,  and  the  price  is  raised  one 
third.  .  Bring  it  to  his  door,  and  his  price  is  tripled.  This  is  the 
principle  of  Protection,  though  these  may  not  be  the  exact  measures 
of  its  operation  in  the  supposed  case.  By  encouraging  and  protecting 
domestic  manufactures,  the  market  is  brought  home,  and  the  expense 
of  transportation  both  ways  is  saved.  Farther  :  All  who  work  at 
manufactures  and  trades  established  by  a  protective  policy,  are 
withdrawn  from  agricultural  pursuits,  and  give  to  the  residue  em- 
ployed in  agriculture  better  chances  for  a  ready  market  and  high 
prices.  The  umltiplication  of  useful  crafts  and  vocations  contrib- 
utes to  the  profit  of  each,  as  well  as  to  national  wealth.  A  home 
market  is  more  steady  and  more  secure,  as  well  as  better  for  prices. 
And  the  money  paid  for  products  of  domestic  manufacture,  instead 


432  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

of  going  abroad,  and  thus  impoverishing  the  nation,  stays  at  home 
and  enriches  it. 

But  the  following  story,  alleged  as  veritable  fact,  is  yet  more 
pertinent,  and  more  forcible,  in  the  instruction  it  affords,  on  this 
point :  A  farmer  in  Illinois  wrote  a  letter  to  his  friend  in  the  east, 
in  1842,  complaining  that  he  could  get  only  31  cents  a  bushel  for 
his  wheat,  25  cents  for  beans,  10  cents  for  corn,  1^  cents  a  pound 
for  beef  and  pork,  2^  cents  a  pound  for  tobacco,  &c.,  stating  that 
he  had  to  fiay  Jive  dollars,  or  which  is  the  same  thing,  16  bushels  of 
wheat,  or  20  bushels  of  beans,  or  26  bushels  of  corn,  or  300  pounds 
of  pork  or  beef,  or  200  pounds  of  tobacco,  ])er  yard  for  British 
broadcloth  to  make  him  a  coat.  The  cost  of  this  yard  of  cloth  at 
the  manufactories  in  England,  was  probably  about  three  dollars,  or 
three  bushels  of  wheat,  as  usually  sold  in  the  market  there.  That 
is,  the  producer  in  England  received  for  the  cloth  o/ieji/fh  of  what 
was  charged  to  the  farmer  in  Illinois.  Who  got  the  difference? 
If  the  manufacturer  had  been  in  Illinois,  or  anywhere  in  this  coun- 
try, tlie  farmer  might  have  got  his  yard  of  cloth  by  a  greatly  less 
quantity  of  his  own  products,  and  the  manufacturer  would  have  made 
a  market  for  the  farmer's  beans,  corn,  pork,  beef,  &c.,  at  a  good 
price.  This  is  the  true  operation  of  the  protective  system  on  agri- 
culture and  other  interests  of  the  country  —  especially  on  those  of 
agriculture.  No  others  are  benefited  so  much  by  it ;  and  no  others 
are  so  much  injured  for  want  of  it.  It  was  proved  by  a  report 
made  to  the  28th  Congress,  house  document  No.  420,  1st  session, 
that,  while  the  prices  of  a  few  agricultural  products  were  slightly 
depressed,  under  the  first  two  years'  operation  of  the  tariff  of  1842, 
by  those  accidents  to  which  such  products  are  ever  liable  from  va- 
riations in  the  seasons  and  other  transient  causes,  there  was  a  gen- 
eral rise  of  prices,  the  average  of  which,  in  a  majority  of -all  the 
cases,  was  25  per  cent. 

Not  to  overlook  or  depreciate  the  benefit  of  a  protective  system 
in  raising  the  prices  of  agricultural  products  and  labor,  in  the  long 
run,  nevertheless,  its  effect  in  sustaining  such  prices  against  the  de- 
pressing influence  of  the  low-priced  labor  of  foreign  parts,  is  alto- 
gether the  most  important.  The  people  of  the  United  States  should 
not  be  deceived  by  the  transient  effect  in  raising  the  prices  of  Amer- 
ican breadstuffs,  in  consequence  of  the  short  crops  in  Europe,  in 
1845  and  1846.  This  state  of  things  was  extraordinary,  and  the 
moment  crops  are  abundant  again  in  that  quarter  of  the  world,  or 
even  tolerable,  the  reaction   in  reducing  the  prices  of  American 


ON    THE    INTERESTS    OF    AGRICULTURE.  433 

breadstiifFs,  will  be  beyond  all  precedent,  if  the  seasons  should  be 
equally  favorable  here,  inasmuch  as  American  farmers  will  naturally 
be  tempted,  under  this  encouragement  of  hiirh  prices  of  breadstuffs, 
to  turn  their  attention  more  to  their  production,  the  result  of  which, 
in  the  case  supposed,  will  be  large  surpluses  without  demand. 
Neither  American  agricultural  labor,  nor  labor  of  any  other  kind, 
can  stand  up  against  the  low-priced  labor  of  Europe,  on  a  Free- 
Trade  basis,  all  other  things  being  equal. 

According  to  the  annual  report  of  the  secretary  of  the  treasury 
for  1845,  our  average  annual  imports  of  woollen  fabrics,  for  the 
twenty-six  previous  years,  were  upward  of  ten  millions  of  dollars 
in  value,  half  of  which  was  an  agricultural  product  —  wool.  The 
secretary  estimated,  that,  by  reducing  the  duty  from  40  per  cent., 
as  it  stood  in  the  tariff  of  1842,  to  30  per  cejit,  for  the  tariff  of 
1846,  the  importations  of  this  species  of  merchandise  would  be 
increased  two  millions  of  dollars  a  year.  It  is  evident,  however, 
that  the  secretary's  estimate  of  the  increase  of  imports  was  by  far 
too  low  for  an  augmentation  of  the  revenue,  which  was  his  declared 
object.  The  reduction  of  duty  is  25  per  cent.  To  make  up, 
therefore,  for  the  abatement  of  25  per  cent,  of  the  duties  on  ten 
millions  of  imports  and  upward,  there  must  be  an  increase  of  im- 
ports of  at  least  five  millions,  instead  of  two.  Not  knowing  what 
amount  of  increase  of  revenue  was  aimed  at,  it  is  impossible  to  say 
what  other  increase  of  imports  would  be  required.  Say,  however, 
two  millions  and  a  half;  which  would  make  the  entire  increase  of 
imports  seven  millions  and  a  half.  Half  of  this,  or  three  millions- 
and  three  quarters,  would  be  an  import  of  wool ;  in  other  words, 
it  would  involve  the  transfer  of  the  raising  of,  and  the  market  for, 
$3,750,000  worth  of  wool  from  American  farmers  to  British  and 
other  foreign  producers  of  this  article  —  not  to  speak  of  the  wrong 
done  to  other  kinds  of  American  labor  that  is  entitled  to  be  em- 
ployed in  the  manufacture  of  this  seven  and  a  half  millions  worth 
of  goods  ;  and  not  to  speak  of  the  general  depression  of  prices  in 
this  and  other  American  agricultural  products,  by  reason  of  this 
increase  of  imports. 

The  same  with  iron.  For  the  fiscal  year  of  1845,  the  aggregate 
value  of  the  imports  of  this  article  and  its  manufactures,  as  stated 
in  the  report  of  the  secretary  of  the  treasury,  was  $9,043,396.  He 
proposed  to  reduce  the  duty  from  75  per  cent,  under  the  tariff  of 
1842,  to  30  per  cent.,  as  it  was  fixed  in  the  tariff  of  1846  ;  and 
thereby  to  obtain  an  additional  importation  of  $1,185,000,  as  he 

28 


434  TIIK    KFFECTS    OF    A    PROTECTIVE    SYSTEM 

estimated.  But  here,  again,  is  the  same  mistake  in  the  estimate, 
as  in  the  case  of  the  woollen  goods,  the  ohject  of  the  reduction  of 
duties  beinf  to  increase  the  revenue.  The  reduction  is  from  75  per 
cent,  to  30  ;  that  is,  more  than  50  per  cent,  abatement  of  duties  on 
a  given  amount  of  imports ;  and  the  imports  of  the  previous  year 
having  been  $9,043,396,  therefore,  to  obtain  an  equal  amount  of 
revenue  by  such  a  reduction  of  duties,  there  would  be  required  an 
import  of  at  least  $20,000,000.  To  increase  the  revenue,  the  im- 
portations must  be  more  than  doubled.  But  it  has  been  proved, 
that  at  least  four  fifths  of  the  value  of  iron  and  its  manufactured 
products,  consist  in  products  of  agriculture  which  enter  into  them. 
Consequently,  if  the  design  of  this  measure  should  be  realized,  the 
farmers  of  the  United  States  would  be  deprived  of  a  market  for 
their  produce,  to  the  amount  at  least  of  eight  millions  of  dollars,  in 
the  case  of  this  single  article.  To  say  nothing  of  the  effect  of  such 
a  cause  on  the  prices  of  agricultural  products,  to  depress  ihem  — 
which  would  be  the  natural  and  unavoidable  consequence  —  this 
positive  loss  of  market  is  no  trifle. 

By  reducing  the  duties  on  coal  from  67  per  cent.,  as  it  was  un- 
der the  act  of  1842,  to  30  under  the  act  of  1846,  the  secretary 
estimated  an  increase  of  imports  of  this  article  in  the  sum  of 
$5, 1 50,000.  All  this,  of  course,  is  a  transfer  of  so  much  business, 
and  of  so  much  labor  of  one  kind  or  another,  from  Americans 
to  foreigners ;  and  one  of  the  worst  features  of  it  is  the  draught  which 
it  must  make  on  the  money  of  the  country.  To  show  how  farmers 
are  interested  in  this  large  and  important  item  of  the  secretary's 
public  economy,  and  how  they  must  be  affected  in  its  practical  op- 
eration, it  is  only  necessary  to  refer  to,  and  unnecessary  to  repeat 
here,  the  statistics  on  this  subject  before  cited  from  the  Hon.  Mr. 
Ramsey,  of  Pennsylvania.  It  is  evident  enough,  that  such  an  ad- 
ditional importation  of  foreign  coal,  could  not  fail  to  produce  the 
most  disastrous  effects  on  all  Americans  —  and  they  are  scores  of 
thousands  —  engaged  in  this  business;  and  the  farmers  would  not 
be  the  smallest  class  of  sufferers. 

These  three  items  of  wool,  iron,  and  coal,  though  relatively  of 
greater  importance  than  most  others,  are  but  the  beginning  of  the 
long  list  of  articles  on  which  this  new  policy  —  not,  indeed,  for  the 
first  time  heard  of,  but  for  the  first  time  reduced  to  experiment  in 
the  United  States  —  is  brought  to  bear  with  the  same  effect  and 
result,  and  in  which,  of  course,  all  the  agricultural  interests  of 
the  country  are  deeply  concerned.     There  is  not  a  class  of  man- 


ON    THE    INTEaESTS    OF    AGRICULTURE.  435 

ufacturers,  or  of  mechanics,  or  of  tradesmen,  or  of  artists,  or  of  any 
of  the  persons  engaged  in  the  ahnost  countless  pursuits  of  Hfe, 
other  than  that  of  agriculture,  which  the  faimers  of  the  country  do 
not  or  ought  not  chiefly  to  supply  with  food  ;  and  none  of  all  these 
which  they  do  not  or  ought  not,  to  a  very  great  extent,  to  supply 
with  clothing.  It  is  their  natural,  social,  political  right,  in  prefer- 
ence to  the  claims  of  foreigners  to  do  the  same  things.  It  is  their 
natural  right,  because  they  are  in  places  contiguous ;  it  is  their 
social  right,  because  they  are  neighbors;  and  it  is  their  political 
right,  because  they  and  all  these  parties  are  members  of  the  same 
political  commonwealth.  And  yet,  it  was  openly  proposed  by  the 
secretary  of  the  treasury  of  the  United  States,  in  his  project  of  a 
public  policy,  established  by  the  tariff  of  1846,  in  addition  to  what 
is  noticed  above,  to  increase  the  imports  of  boots  and  shoes, 
$45,000 ;  of  ready-made  clothing,  S200,000  ;  of  blacksmith's 
work,  $200,000;  of  hats,  $110,000;  of  leather,  $100,000;  of 
glass,  $100,000;  of  paper,  $150,000;  of  hemp,  cordage,  &c., 
$275,000;  of  pins,  $50,000;  of  salt,  $1,000,000;  of  sugar, 
$630,000;  of  wool,  unmanufactured,  $200,000;  of  potatoes, 
$150,000,  &c.,  &c.  And  many  of  these  estimates  are  as  much 
below  what  would  be  required  for  the  necessary  revenue,  under 
the  reduction  of  duties  fixed  by  the  tariff  of  1846,  as  those  given 
for  woollen  goods,  iron,  and  coal,  as  above  noticed.  So  much 
business,  and  all  the  profits  thereof,  it  is  proposed,  by  an  American 
government,  to  take  out  of  the  hands  of  the  American  people,  and 
give  to  foreigners.  And  Americans,  by  being  thus  forced  to  buy  what 
they  could  produce,  and  wish  to  produce,  and  the  production  of 
which  is  necessary  to  their  welfare  and  happiness,  are  forced  to 
bear  the  immense  system  of  foreign  taxation  on  all  these  imports, 
at  the  same  time  that  they  are  impoverished  for  want  of  the  work. 

But  to  show  yet  farther  how  farmers  are  affected  by  this  policy, 
we  shall  avail  ourselves  of  the  following  extract  from  a  speech  of 
the  Hon.  Andrew  Stewart,  of  Pennsylvania,  delivered  in  Congress, 
May  27,  1846,  in  part  a  repetition  of  what  we  have  already  given, 
but  in  a  different  form,  and  well  put:  — 

"  With  all  the  protection  we  now  enjoy"  [under  the  tariff  of 
1842],  said  Mr.  Stewart,  "Great  Britain  sends  into  this  country 
eight  dollars'  icorth  of  her  agricultural  productions  to  07i('  Jol/ur^s 
worth  of  all  our  agricultural  productions,  save  cotton  and  tobacco, 
that  she  takes  from  us.  I  assert,  and  can  prove,  that  more  than 
half  the  value  of  all  the  British  merchandise  imported  into  this 


436  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

country,  consists  of  agricultural  iiroclucts,  changed  in  form,  con- 
verted and  mannfactured  into  goods.  Take  down  all  the  articles 
in  a  store,  one  after  another  ;  estimate  the  value  of  the  raw  material, 
the  bread  and  meat,  and  other  agricultural  products  which  have 
entered  into  their  fabrication  ;  and  it  will  be  found,  that  one  half 
and  more  of  their  value  consists  of  the  productions  of  the  soil  — 
agricultural  produce  in  its  strictest  sense.  By  reference  to  Mr.  Walk- 
er's report,  it  will  be  seen,  that,  for  twelve  years  back,  we  have  im- 
ported from  Great  Britain  and  her  dependencies  annually,  fifty-nine 
and  a  halfmillions  of  dollars  worth  of  goods  —  call  it  fifty  millions  — 
while  she  took  of  all  our  agricultural  products,  save  cotton  and  to- 
bacco, less  than  tivo  and  a  /<a//"millions  of  dollars  worth.  Thus,  then, 
assuming  one  half  the  value  of  her  goods  to  be  agricultural,  it  gives 
us  S25,t)00,000  of  her  agricultural  produce  to  $2,500,000  of  ours 
taken  by  her,  which  is  just  ten  to  one  ;  to  avoid  cavil,  put  it  at  eight 
to  one.  .  .  We  have  imported  yearly,  for  twenty-six  years — so 
says  Mr.  Walker's  report — more  than  ten  millions  of  dollars  worth 
of  woollen  goods.  Last  year  we  imported  $10,066,176  worth. 
Now,  one  half  and  more  of  this  cloth  was  made  up  of  wool,  the 
product  of  labor  and  agriculture.  The  general  estimate  is,  that  the 
wool  alone  is  half.  The  universal  custom  among  farmers,  when 
they  had  their  wool  manufactured  on  shares,  was  to  give  the  man- 
ufacturer half  the  cloth.  Thus  we  import,  and  our  people  have 
to  pay  for,  Jive  millions  of  dollars  worth  of  foreign  wool,  mostly 
the  product  of  sheep-feeding  on  the  grass  and  grain  of  Great 
Britain,  to  the  prejudice  of  the  market  for  our  own  wool  ;  and  this 
is  the  policy  gentlemen  recommend  to  our  farmers!  Yes,  sir; 
and  not  satisfied  with^rc  millions,  they  wish  to  increase  it  to  ten 
millions  a  year  for  foreign  wool.  Will  gentlemen  deny  this? 
They  dare  not.  They  supported  Mr.  Walker's  bill,  reducing  the 
duties  on  woollens  nearly  one  half,  v^ith  a  view  to  increase  the  rev- 
enue. Of  course  the  imports  must  be  doubled,  making  the  import 
of  cloth  twenty  millions  instead  of  ten,  and  of  wool  ten  instead  of 
Jive  millions  of  dollars  per  annuu).  .  .  What  is  true  of  cloth  is 
equally  true  of  everything  else.  Take  a  hat,  a  pair  of  shoes,  a 
yard  of  silk  or  lace,  analyze  it,  resolve  it  into  its  constituent  ele- 
ments, and  you  will  find  that  the  raw  material  and  the  substance 
of  labor,  and  other  agricultural  products,  constitute  more  than  one 
half  of  its  entire  value.  The  pauper-labor  of  Europe  employed 
in  manufacturing  silk  and  lace,  gets  what  iteat^,  no  more  ;  and  this 
is  what  you  pay  for,  when  you  purchase  their  goods.     The  article 


ON    THE    INTERESTS    OF    AGRICULTURE.  437 

of  iron  is  a  stronger  case.  Last  year,  according  to  Mr.  Walker's 
report,  we  imported  $9,043,396  worth  of  foreign  iron  and  its  man- 
ufactures, mostly  from  Great  J^r'va'm,  Jmir  ^ff /is  of  the  value  of 
which,  as  every  practical  man  knows,  consist  of  agricultural  prod- 
uce—  nothing  else.  What  gives  its  value  ?  The  labor  of  horses, 
oxen,  mules,  and  men.  And  what  sustained  this  labor,  but  corn, 
oats,  hay,  and  straw  for  the  one,  and  bread,  meat,  and  vegetables 
of  every  kind,  for  the  other?  These  agricultural  products  are 
purchased  and  consumed,  and  make  up  nearly  the  whole  price  of 
the  iron,  which  the  manufacturer  receives  and  pays  over  to  the 
farmers  again  and  again,  as  often  as  the  process  is  repeated.  Is  not 
iron  made  in  England  of  the  same  materials  that  it  is  made  of  here? 
Certainly.  Then  is  noi  four fifihs  of  the  value  of  British  iron  made 
up  of  British  agricultural  produce?  And  if  we  purchase  nine  mil- 
lions of  dollars  worth  of  British  iron  a  year,  do  we  not  pay  six  or 
seven  millions  of  this  sum  for  the  produce  of  British  farmers  — 
grain,  hay,  grass,  bread,  meat,  and  other  provisions  for  man  and 
beast  —  sent  here  for  sale  in.  the  form  of  iro?i  ?  .  .  Mr.  Secretary 
Walker  informs  us  that  the  present  duty  on  iron  is  75  per  cent., 
which  he  proposes  to  reduce  to  30  per  cent,  [which  is  the  duty  of 
the  tariff  of  184G],  to  increase  the  revenue. '  To  do  this,  must  he 
not  then  double  [more  than  double]  the  imports  of  iron?  Surely 
he  must.  Then  we  must  add  ten  or  twelve  millions  a  year  to  our 
present  imports  of  iron,  and  of  course  destroy  that  amount  of  our 
domestic  supply  to  make  room  for  it.  Thus  at  a  blow,  in  the  sin- 
gle article  of  iron,  this  bill  is  intended  to  destroy  the  American 
market  for  at  least  eigJit  m  ill  ions  of  dollars  worth  of  domestic 
agricultural  produce,  to  be  supplied  from  abroad." 

The  following  extract  from  Adam  Smith  will  show  that  he  was 
aware  of  this  great  truth  in  public  economy,  though  it  is  singular 
that  it  should  require  three  fourths  of  a  century  for  its  full  devel- 
opment: "A  piece  of  fine  cloth  which  weighs  only  eight  pounds, 
contains  in  it  the  price,  not  only  of  eight  pounds  weight  of  wool, 
but  sometimes  of  several  thousand  weight  of  corn,  the  maintenance 
of  the  different  working  people,  and  of  their  immediate  employers. 
The  corn  which  could  with  difficulty  be  carried  abroad  in  its  own 
shape,  is  in  this  manner  virtually  exported  in  that  of  the  complete 
manufacture,  and  may  easily  be  sent  to  the  remotest  corners  of  the 
world.  In  this  manner  have  grown  up  naturally,  and  as  it  were  of 
their  own  accord,  the  manufactures  of  Leeds,  Halifax,  Sheffield, 
Birmingham,  and  Woolverhampton.     [Now  may  be  added  Man- 


433        THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

Chester,  Taisley,  and  many  other  manufacturing  towns  of  England 
and  Scotland.]  In  the  modern  history  of  Europe,  their  extension 
and  improvement  have  generally  been  posterior  to  those  which 
were  the  offspring  of  foreign  commerce.  England  was  noted  for 
the  manufacture  of  fine  cloths  made  of  Spanish  wool  more  than  a 
century  before  any  of  those  which  now  flourish  in  the  places 
above  mentioned  were  fit  for  foreign  sale.  The  extension  and  im- 
provement of  these  last  could  not  take  place  but  in  consequence 
of  the  extension  and  improvement  of  agriculture,  the  last  and 
greatest  effect  of  foreign  commerce,  and  of  the  manufactures  im- 
mediately introduced  by  it." 

The  English  Free-Traders  have  overshot  the  mark,  and  given 
advice  to  all  the  world,  which  was  designed  for  home  consump- 
tion. They  would  have  been  more  wise,  if  they  had  held  all  their 
debates  with  domestic  opponents,  behind  closed  doors.  For  ex- 
ample, in  the  "  Examiner,"  where  we  find  Mr.  Brown's  letter,  we 
also  find  an  article  the  next  month,  of  which  the  following  is  an 
extract :  "  Manchester,  Birmingham,  and  Leeds,  are  the  great 
merchants  who  buy  the  duke  of  Buckingham's  wheat  [a  metaphor, 
meaning  any  Englishman's  wheat]  at  55s.  per  quarter,  pay  a  bounty 
of  2O5.  with  it  [making  75s.  per  quarter],  and  then  sell  it  abroad  at 
35s.  per  quarter.  In  fact,  it  is  the  foreigner  who  pays  the  farm  la- 
borer and  the  landlord's  rent;  and  if  the  Chinamen,  and  the  Yan 
kees,  and  the  Germans,  were  to  stop  payment,  what  would  become 
of  mortgages  and  daughters'  settlements." 

It  can  not  be  denied,  that  this  is  a  candid  disclosure  ;  and  if 
"  the  foreigner,''^  especially  "  the  Yankees,"  are  not  instructed  by 
it,  they  must  have  lost  their  reputed  sharpness.  Is  not  this  cool, 
not  to  say  impudent,  for  an  English  Free-Trader  to  insult  the  world 
with  such  a  notice  ?  It  is  the  ^^Ytrnkees,''^  then,  who  redeem  their 
morfo-affes,  and  furnish  the  dauo-hters  of  the  English  landlords  with 
settlements,  by  consuming  their  agricultural  products,  in  the  form 
of  manufactured  goods !  This,  doubtless,  is  the  exact  truth.  Some, 
perhaps,  will  be  puzzled  to  discern  what  this  writer  means  by  pur- 
chasing "the  duke  of  Buckingham's  wheat"  at  a  cost  of  75s.  per 
quarter,  and  selling  it  at  35.s'.  It  is  simply  this  :  It  goes  into  the 
mouth,  "  laboratory,"  of  Mr.  Brown's  "  wonderful  intellectual  ma- 
chine, man,"  the  British  operative,  "  and  gives  him  the  physical 
power,  aided  by  steam,  of  converting  it  into  broadcloth,  calico, 
hardware,"  &c.  This  "  physical  power,"  imparted  by  the  bread, 
is  such  a  multiplication  of  the  power  of  its  cause,  that  a  moiety 


ON    THE    INTERESTS    OF    AGRICULTURE. 


439 


thereof  is  worth  more  than  the  whole  cost  of  the  power  that  pro- 
duced it ;  and  this  is  the  way  in  which  they  buy  "  the  duke  of 
Buckingham's  wheat"  at  75s.  per  quarter,  and  sell  it  at  355. 

That  this  great  and  important  doctrine,  viz.,  that  agricultural 
products  and  labor  incorporate  themselves  with  those  of  manvfacture, 
constitute  the  principal  part  of  them,  and  go  forth  in  this  disguise  to 
market,  at  home  and  abroad,  wherever  the  articles  of  manufacture 
are  in  request,  is  well  understood  in  England,  appears  to  be  evident 
enough ;  though  all  British  economists,  for  reasons  that  appear  else- 
where in  this  work,  have  taken  good  care  to  keep  it  out  of  sight.* 
It  only  requires,  that  it  should  be  understood  in  the  United  States, 
and  the  agriculturists,  the  farmers,  of  this  country,  will  then  see 
where  their  true  interest  lies.  It  lies  in  a  protective  system,  that 
shall  secure  a  home  market  for  their  products.  Nature,  sound  pol- 
icy, and  Providence,  seem  to  l)ave  decided,  that  agriculture  and 
manufactures,  in  the  United  States  —  anywhere,  indeed  —  should 
support  each  other,  and  that  they  together  should  keep  commerce 
in  motion,  to  distribute  their  products  over  the  face  of  the  earth  ; 
for  the  products  of  manufacture  are  but  the  products  of  agriculture 

•  It  seems,  too,  that  the  secretary  of  the  treasury  of  the  United  States,  in  his  an- 
nual report  for  December,  1847,  has  also  endeavored  to  keep  this  out  of  sight,  by  a 
most  extraordinary,  even  audacious  statement.  He  says,  that  "  the  average  ex- 
ports of  breadstulis  and  provisions  were  much  larger  in  the  years  of  low,  compared 
with  high  duties,  the  tables  of  the  Ireasnry  clearly  prove."  The  veracity  of  this 
statement  is  most  unfavorably  tested  by  the  following  extracts  from  these  very  "  ta- 
bles of  the  treasury,"  as  officially  certified  and  published  by  himself.  We  have 
added  a  third  column,  to  show  the  amount  of  agricultural  products  and  labor  im- 
ported from  the  same  quarter,  for  the  same  years,  rating  them  at  half  the  cost  of 
the  imjiorts,  as  above  shown  not  to  be  too  large.  Tliis  third  column  is  at  the  same 
time  an  illustration  and  a  proof  of  the  doctrine  of  this  chapter,,as  stated  in  the  text 
above  in  italics :  — 


Years. 


Under  high  tariff - 


Amount  of  imports 
from  Great  Britain. 


1829 $27,000,000 

1830 26,000,000 

1831 47,000,000 

1832 42,000,000 


Total 142,000,000 

Average  of  4  years 35,500,000 


Under   low  tariff— 1835 66,000,000 

1836 86,000,000 

1837 52,000,000 

1838 49,000,000 


Total 253,000,000 

Average  of  4  years 63,250,000 


Amount  breadstufls 
exported  to  Great 
Britain    from    the 
United  States. 

Arnt  agrrciilt*!  prod- 
ui;t!=  ami  labor  im- 
ported    ill    gtioiis, 
being  Vi  of  i-osts. 

$1,777,124 

$13,500,000 

1,606,738 

13,000,000 

5,578,592 

23,.500,000 

541,787 

21,000,000 

9,504,241 

71,000,000 

2,376,060 

17,750,000 

28,917 

33,000,000 

1,684 

43,000,000 

1,402 

26,000,000 

62,626 

24,500,000 

94,629 

126,500,000 

23,657 

31,62.5,000 

440  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

in  disguise,  as  above  shown,  and  this  is  the  only  way  in  which  the 
prices  of  American  agricultural  labor  can  be  sustained  at  home  and 
abroad.  Let  American  agriculture  find  a  market  in  American  man- 
uAictures,  by  an  adequate  system  of  Protection,  and  it  has  the  mar- 
ket of  the  world  at  its  feet,  which  otherwise  it  could  never  iiave  — 
nor  the  smallest  part  of  it — at  remunerating  prices.  It  will  be  of 
no  use  for  American  farmers  to  raise  corn  for  Europe  and  other 
foreign  parts,  when  the  return  of  favorable  seasons  shall  bless  them 
with  good  crops  again,  so  long  as  labor  is  lower  there  than  they  are 
willing  to  work  for.  They  must  soon  get  sick  of  that.  Insmutable 
laws  have  decided  ao-ainst  it.  But  there  is  not  a  sino-le  manufac- 
turing  or  mechanic  art,  if  adequately  protected,  in  which  American 
skill  can  not  equal  that  of  Europeans,  in  a  course  of  time.  And  if 
Americans  can  equal  them  in  skill,  they  can  equal  them  in  all  things 
else,  and  gradually  obtain  their  proper  share  of  the  market  of  the 
world  ;  for  European,  and  all  foreign  nations,  labor  under  disadvan- 
tages, inherent  in  their  institutions,  from  which  the  people  of  the 
United  iStates  are  exempt.  Even  under  the  slender  and  inadequate 
protection  extended  to  American  arts  heretofore,  Americans,  in  some 
things,  have  entered  into  competition  over  the  wide  world,  with  the 
boasting  mistress  of  the  arts,  that  boasts  of  being  mistress  of  the  seas, 
and  were  rapidly  gaining  upon  her  under  the  tariff  of  1842.  That 
is  conclusive  evidence  of  what  can  be  done.  In  this  way,  and  in 
no  other,  can  the  prices  of  American  labor  be  sustained.  That  de- 
voted to  agriculture  would  be  kept  up,  because  the  policy  supposes 
that  it  would,  as  near  as  convenient,  have  in  view  only  the  supply 
of  the  home  market,  which  is  always  best,  most  uniform,  and  most 
secure.  The  prices  of  manufacturing  and  mechanical  labor  would 
be  kept  up,  fiirst,  because  experience  proves  it ;  next,  because  it 
could  be  afforded  ;  and  thirdly,  because  labor  would  occupy  a  po- 
sition to  demand  if.  And  lastly,  the  prices  of  manufactured  articles 
would  be  kept  down,  and  reduced  still  lower,  first,  because  experi- 
ence proves  that,  too,  as  shown  in  these  pages  ;  and  next,  because 
they  mvst  be  reduced,  in  order  to  compete  with  the  manufactured 
products  of  Europe.  It  is  in  a  home  market  only,  that  American 
agricultural  labor  can  ever  be  secure  of  its  reward  ;  and  the  expe- 
rience of  Great  Britain  proves,  as  shown  in  this  chapter — all  expe- 
rience proves  —  that  the  market  for  agricultural  products  in  a  great 
manufacturing  system,  like  that  of  England,  and  like  that  which 
might  be  erected  in  the  United  States,  under  an  adequate  system 
of  Protection,  is  indefinite,  boundless. 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.      441 


CHAPTER    XXVIII. 

THE    EFFECTS    OF    A   PROTECTIVE    SYSTEM    ON    THE    INTERESTS 
OF    COMMERCE    AND    NAVIGATION. 

Departments  of  Lnbor  interested  in  Navii^ation. — Ship  Builders,  Mechanics,  and  Sailors, 
all  require  Protection. — Ship-Owners  require  it — What  would  be  ihe  Effects  of  abol- 
ishina:  our  Navis;ation  Laws — Navitration  nnd  Commerce  two  Interests — Siatislical 
Proof-'  of  the  different  Effects  of  Free  Trade  ami  Protection  on  these  two  Interests. — 
The  Position  and  Interests  of  Imp'>rtini»  Meichants  hostile  to  the  Interests  of  the  Coun- 
try— Statistics  continued,  w  ith  a  Variety  of  Facts,  mixed  with  Doctrine. — Commercial 
and  Reciprociiy  Treaties  all  bad,  as  proved  hy  Experience. — Recip'-ocily  necessarily  em- 
bodies the  Principles  of  Free  Trade — Fnrei^'n  Commerce,  under  a  Protective  System, 
may  be  made  to  supply  all  the  Wants  of  Government,  without  taxing  the  People. 

The  interests  of  navigation  proper,  as  the  instrument  of  conn- 
merce,  comprehend  a  very  large  department  of  labor — the  labor 
of  constructing  the  craft,  of  producing,  collecting,  and  forming  the 
materials,  ;md  the  adventurous  tasks  of  those  who  use  and  guide 
these  instruments  of  commerce  on  the  bosom  of  the  deep.  These 
are  distinct  branches  of  labor,  employing  a  large  portion  of  every 
commercial  community.  The  materials  of  ship-building  nearly  all 
come  originally,  either  from  the  forest,  or  from  the  culture  of  the 
soil,  or  from  the  mines,  and  consist  chiefly  of  timber,  hemp,  iron, 
copper,  &c.  Sundry  manufactures  and  a  variety  of  the  mechanic 
arts  enter  into  the  formation  of  these  materials,  and  are  required  to 
adapt  them  to  their  ultimate  design  and  use.  It  will  be  found  that 
all  these  materials,  and  all  the  manufacturing  and  mechanic  arts 
thus  employed,  as  much  require  protection  in  their  progress,  from 
beginning  to  end,  as  anything  else;  inasmuch  as  there  is  no  kind 
of  labor  put  in  requisition  in  preparing  the  materials  for  ship-build- 
ing, and  in  the  construction  of  ships,  which  does  not  have  to  en- 
counter the  antagonism  of  low-priced  foreign  labor,  which  would 
impair  its  rights,  and  drive  it  from  the  field,  without  the  shield  of 
protection.  Nor  does  this  prove,  as  Free  Trade  continually  a.s- 
serts,  that  ships  would  cost  less  without  a  protective  system.  For 
the  same  great  principle  applies  here  as  to  all  other  branches  of 
American  labor,  viz.,  protect  it,  and  although  its  own  prices,  as 
labor,  are  higher,  yet  its  products  of  manufacture  and  art  will  be 
cheaper  than  the  imported  products  of  foreign  low-priced  labor,  if 
we  are  dependent  upon  them.     This  has  been  abundantly  proved 


442       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

in  another  chapter,  and  in  application  to  the  most  important  mate- 
rials and  parts  of  ship-building,  timber,  iron,  hemp,  cordage,  cop- 
per, &c. 

It  is  true,  indeed,  that  ships  can  be  and  are  built  on  the  shores 
of  the  Baltic  at  a  cost  very  much  less  than  in  the  United  States, 
and  it  might  seem,  at  a  first  view,  to  be  for  the  interest  of  Ameri- 
can ship-owners  and  merchants  engaged  in  navigation  to  order  and 
import  their  ships  already  built  and  equipped.  So  it  might  seem 
to  be  for  their  interest  to  man  them  from  abroad,  inasmuch  as  for- 
eign sailors  do  not  get  but  about  half  the  wages  of  American  sailors. 
We  say  it  might  seem  to  be  for  their  interest.  But  the  advocates 
of  Free  Trade  always  fall  into  a  fatal  error,  and  others  are  in  dan- 
ger of  being  drawn  along  with  them,  by  assuming  that  American 
consumers  of  the  products  of  foreign  low-priced  labor  can  profit  by 
it;  whereas,  the  moment  we  allow  ourselves  to  be  dependent,  we 
find  everything  costs  more  than  when  we  are  independent  under  a 
protective  system.  This  has  been  proved  in  a  former  part  of  this 
work.  In  the  same  manner,  if  American  ship-owners  and  mer- 
chants were  permitted  to  buy  and  man  their  ships  from  abroad,  and 
to  trade  in  foreign  bottoms,  till  American  shipyards  should  be  closed 
for  want  of  work,  as  they  doubtless  would  be,  the  same  consequen- 
ces would  naturally,  not  to  say  necessarily,  follow,  as  in  all  other 
cases  to  which  P^ree  Trade  leads:  first,  the  employment  of  Amer- 
ican labor,  and  the  use  of  American  arts,  are  suppressed  ;  next, 
these  being  suppressed,  and  foreign  labor  and  arts  having  ti)e  mo- 
nopoly, and  being  in  great  demand,  they  could  command  their  own 
prices  ;  thirdly,  and  consequently,  it  would  instantly  be  found,  in 
all  such  cases,  as  always  before  in  all  other  similar  cases,  that  prices 
would  rise,  and  the  same  things  would. cost  more  than  at  home  un- 
der a  system  of  protection. 

But  the  navigation-laws  of  the  United  States  very  properly  for- 
bid such  a  course  to  American  ship-owners  and  merchants,  and  it 
is  therefore  out  of  the  question.  They  are  forced  to  build  and  buy 
at  home  ;  and  it  was  for  purposes  of  protection  that  these  laws 
were  enacted.  They  are  among  the  strongest  statutes  ever  foisted 
into  a  protective  code,  and  are  universally  conceded  to  be  impor- 
tant and  indispensable.  But  for  these  laws,  there  would  scarcely 
be  an  American  bottom  entering  our  ports  from  foreign  parts,  and 
our  coasting-trade  itself  would  be  monopolized  by  foreign  craft. 
For  how  could  our  own  craft,  which  costs  so  much  more,  and  our 
own  sailors  whose  wages  are  so  much  higher  than  those  of  foreign 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       443 

sailors,  compete  with  such  an  opposition,  on  the  basis  of  Free 
Trade  ?  It  would  be  impossible.  And  it  is  seldom  considered 
that  Free  Trade  strikes  at  the  root,  at  the  foundation,  of  our  entire 
system  of  navigation,  and  that  it  would  be  totally  destructive  of  all 
its  interests  —  of  all  the  interests  of  ship-builders,  of  all  the  provi- 
ders of  n)aterials  for  ship-building,  of  all  the  manufacturers,  me- 
chanics, and  artists,  engaged  in  the  various  parts  of  work  required 
for  building  and  equipping  ships,  and  of  all  the  American  sailors 
and  navigators  employed  in  our  commercial  marine.  Not  one  of 
them  could  subsist  in  the  reign  of  Free  Trade  applied  to  naviga- 
tion and  to  the  building  of  navigating  craft,  except  as  their  wages 
should  be  reduced  to  the  level  of  the  wages  of  foreigners  engaged 
in  the  same  employments  ;  which,  indeed,  would  be  the  unavoida- 
ble result.  In  other  words,  foreigners  having  once  monopolized 
the  business,  in  all  its  branches,  would  keep  it  at  their  own  prices. 

That  those  engaged  in  the  pursuits  connected  with  navigation, 
and  in  navigation  itself,  should  expect  to  escape  these  consequences 
of  Free  Trade,  as  they  bear  on  themselves,  is  a  delusive  hope,  if 
Free  Trade  is  to  have  full  scope  :  and  why  should  it  not,  if  the 
doctrine  be  sound  ?  Such  immunity  would  be  a  partiality  which 
other  classes  of  the  community  would  hardly  tolerate.  All  must 
stand  under  Protection,  or  fall  under  Free  Trade,  together.  The 
theory  of  Free  Trade  knows  no  distinction  or  exception  of  pur- 
suits. 

The  interests  of  navigation,  as  must  be  seen,  are  distinct  from 
those  of  commerce,  though  both  are  often  combined  in  the  same 
parties.  Navigation  is  the  instrument  or  agent  of  commerce,  and 
the  carrying-trade  is  the  source  of  its  profits.  Apart  from  the  in- 
fluence of  extraordinary  events,  such  as  the  scarcity  of  provisions 
in  Europe  and  other  foreign  parts,  as  in  1846  and  1847,*  one  of 
the  surest  rules  of  determining  the  effects  of  a  protective  system  or 
the  want  of  it,  on  the  interests  of  navigation,  is  the  comparative 
amount  of  tonnage  employed  in  the  carrying-trade,  under  these 
two  states  of  things,  respectively.  It  may,  indeed,  be  called  an 
infallible  rule.     Look,  then,  at  the  following  facts  : — 

It  appears,  by  the  United  States  treasury  documents,  that,  in 
1840,  when  Free  Trade  had  brought  down  the  country  to  the  low- 

•  The  secretary  of  the  treasury,  in  his  annual  report  of  December  9,  1847,  has 
made  an  unjustifiable  use  of  the  increase  of  tonnage  required  to  transport  Ameri- 
can bread-stuffs  to  Europe,  in  consequence  of  short  crops  in  that  quarter  in  1846-'?. 
He  has  also  forced  results  on  this  point  from  other  assumed  data,  which  are  incon- 
sistent with  his  own  official  tables. 


444       THE  EFFECTS  OF  A  PROTECTIVE  SVSTEM 

est  depths  of  commercial  ruin,  still  running  down,  the  total  tonnage 
of  the  United  Slates  amounted  to  2,180,764  tons;  in  1841,  to 
2,130,744  ;  and  in  1842,  to  2,092,300  :  showing  a  falling  ofF  in 
three  years,  before  the  passage  of  the  tariff  of  1842,  of  88,464 
tons,  instead  of  a  gradual  increase,  as  it  ought  to  have  been.  Af- 
ter the  enactment  of  the  tariff  of  1842,  the  tonnage  rose,  in  1843, 
to  2,158,601  tons;  in  1844,  to  2,280,095;  and  in  1845,  to 
2,417,002  :  being  a  gain  in  three  years,  under  the  tariff  of  1842, 
of  258,401  tons.  The  tonnage  built  in  the  United  States,  in  1845, 
was  greater  by  28,000  tons  than  the  average  of  the  three  prece- 
ding years,  showing  an  increasing  demand. 

From  the  same  official  records  it  appears  that  the  tonnage  which 
entered  the  ports  of  the  United  States,  and  cleared,  in  1841,  was 
4,639,458  tons  ;  and  in  1842,  when  the  duties  were  down  to  the 
lowest  ebb,  4,519,841  tons.  But  in  1844,  two  years  after  the 
passage  of  the  tariff  of  1842,  it  had  risen  to  5,812,168  ;  and  in 
1845,  to  5,930,303.  These  figures  show  a  falling  off  from  1841 
to  1842,  when  duties  were  lowest,  of  219,617  tons  ;  and  an  in- 
crease in  one  year,  from  1844  to  1845,  under  what  are  called  high 
duties,  of  118,135  tons.  The  tonnage  which  entered  and  cleared 
in  1845,  was  1,410,462  tons  more  than  in  1842,  before  the  tariff 
of  that  year,  dated  August  30,  had  begun  to  take  effect.  These, 
as  can  not  be  denied,  are  strong  facts,  and  directly  to  the  point. 
They  are,  indeed,  conclusive. 

The  explanation  of  this  result  is,  that  a  Free-Trade  system  in- 
creases the  amount  of  manufactured  imports,  which  are  not  only 
of  great  and  ruinous  cost  to  the  country,  by  depriving  home  labor 
of  employment,  and  drawing  away  money,  but  which  employ  the 
least  amount  of  tonnage,  and  thus  injure  the  interests  of  navigation. 
Free  Trade  also  diminishes  those  imports  —  such  as  raw  materials 
for  home  manufacture  —  which  employ  the  greatest  amount  of  ton- 
nage, and  benefit  navigation  ;  whereas,  a  protective  system  pro- 
duces a  directly  contrary  effect  in  all  these  particulars,  viz.  :  dimin- 
ishes imports  of  manufactured  products,  which  are  of  little  benefit 
to  navigation  ;  increases  those  imports  which  make  the  profit  of 
navigation,  and  give  employment  and  profit  to  home  labor  ;  and 
farther  employs  and  encourages  home  labor,  by  securing  to  it  the 
manufacture  of  those  articles  the  import  of  which  is  discouraged  by 
protection. 

There  was  perhaps  never  presented  a  more  condensed,  and  at 
the  same  time  full,  view  of  this  argument,  than  that  which  was  ex- 


0:\   THE  INTERESTS  OP  COMMERCE  AND  NAVIGATION.         445 

hibited  by  tlie  Hon.  Daniel  Webster,  In  his  speech  delivered  in  the 
senate  of  the  United  States,  July  2oth  and  27th,  1S4G,  when  the 
tariff  of  184G  was  under  debate  ;  nor  can  we  do  better  than  copy 
his  remarks  and  tables  as  a  part  of  our  own  argument  on  this  point. 
They  will  be  found  in  the  note  below.* 

In  further  execution  of  the  plan  of  this  chapter,  it  is  proposed 
here  to  consider  only  that  portion  of  our  commerce  which  is  car- 
ried on  between  the  United  States  and  foreign  parts,  and  to  leave 

♦  "  Now,  sir,  1  proceed  to  say  something  upon  the  influence,  the  necessary  influ- 
ence, which  this  proposed  change  in  our  system  will  exercise,  upon  the  commerce 
and  navigation  of  the  country.  I  shall  do  that  by  exhibitin?  a  series  of  tables  which 
will  speak  for  themselves  ;  which  I  know  have  been  drawn  up  with  great  accuracy, 
founded  on  the  last  official  communication  of  the  secretary  of  the  treasury,  so  far 
as  revenue  is  concerned,  and  estimates  regarding  the  value  of  freights,  collected 
from  the  first  mercantile  sources  in  the  country.  Now,  as  a  general  remark  on 
these  various  papers,  and,  which  they  fully  confirm,  I  wish  to  say,  what  would 
naturally  be  expected  to  be  true,  that  for  some  years  past,  since  the  favor  and  pro- 
tection of  the  government  were  given  to  the  internal  manufactures  of  the  country, 
the  foreign  trade  of  the  country  has  conformed  to  that  state  of  things;  and  a 
change  in  the  business  of  navigation,  and  commerce,  and  freight,  consequent  upon 
these  internal  changes,  is  quite  as  striking  as  these  internal  changes  then)selves; 
and  the  great  element  of  that  change  consists  in  a  change  in  the  nnture  of  the 
main  articles  of  import,  showinir  a  diminution  of  articles  of  manufactured  charac- 
ter, and  a  vast  augmentation  of  articles  of  the  character  of  raw  material,  or  bulky 
articles.  The  consequence  of  which,  as  will  be  seen  by  the  tables  I  am  about  to 
exhibit,  is  a  large  actual  increase  of  the  earnings  of  the  shipping  interest  on  im- 
ports. Because  all  know  that  freight  is  proportioned  to  the  bulk  of  the  article, 
and  not  to  its  cost.  It  is  the  space  that  the  commodity  fills  in  the  ship,  and  not 
its  value,  which  regulates  the  rate  of  freight.  Therefore  it  is,  that  though  the  im- 
portations may  be  greatly  augmented  in  value,  from  being  composed  of  manufac- 
tured articles  chiefly,  yet  the  freight  is  not  increased  in  the  same  ratio,  but  may  be 
diminished.  That  fact  is  notorious  to  all  those  acquainted  with  the  commerce  of 
the  country.  It  is  perfectly  understood  by  all  the  ship-owners  of  the  United  States; 
and  that  fact  is  of  itself  sufficient  to  account  for  the  great  and  important  truth,  that 
the  navigation  interest  of  the  United  States,  the  ship-owners,  to  a  man,  oppose  this 
change  of  system ;  because  the  existing  system  gives  more  employment  to  this 
navisation,  than  the  system  now  attempted  to  be  substituted  for  it. 

"  Now,  sir,  a  heavy  mass  or  amount,  in  value,  of  manufactured  articles,  as  is 
well  known,  comes  from  France  and  England.  Our  more  various  commodi- 
ties and  our  importations  of  heavy  articles,  come  from  round  the  capes,  and 
from  Brazil,  and  the  north  of  Europe.  The  tables  which  I  propose  to  exhibit  to 
the  senate,  will  show  the  amount  of  these,  respectively,  and  the  change  produced 
in  them  within  the  last  five  years.  Now,  sir,  let  me  premise,  that  articles  of  im- 
port into  the  United  States  are  properly  divisible  into  three  classes.  First,  those 
articles  which  come  here  manufactured,  and  fit  for  use  or  for  sale;  secondly,  arti- 
cles not  manufactured,  brought  here  for  consumption  as  imported,  without  any 
manufacture  after  they  arrive;  thirdly,  those  articles  which  are  in  the  nature  of 
raw  materials,  and  are  brought  here  to  undergo  a  process  of  manufacture.  Let  us, 
then,  see  the  amount  of  freight  derived  from  these  three  respective  classes  of  im- 
ports : — 


4-16        THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 


the  coastinii  business  to  be  noticed  with  the  home  trade,  of  which 
it  is  a  part.     It  might  seem  at  first  sigbt,  that  a  pubhc  pohcy  which 

Net  Imports,  m  1845,  of  Foreign  Manufactured  Articles. 

Articles.                      Value  in  Dolls.  Duties  in  Dolls.       freights  in  Dolls. 

Silk 10,840,000  2,968,000  3(5,100 

Wool ••    10,750,000  3,755,000  80,625 

Cotton 13,360,000  4,908,000  133,360 

Flax "...     4,893,000  1,263,000  48,930 

Iron 4,022,000  1,607,000  120,360 

Railroadlron 1,000,000  600,000  96,000 

Cigars 1,086,000  30.5,000  25,000 

Brass  and  other  Metals 3,690,000  688,000  55,500 

Earthern  and  Glass  Ware...     3,122.000  2,087,000  218,540 

Clothing,  ready  made 1,108,000  449,000  11,0S0 

Hats  and  Bonnets 732,000  256,000  10,980 

Leather,  Boots,  and  Shoes....        848,000  242,000  12,720 

Paper 276,000  60,000  4,140 

Cotton  Ba-sing 102,000  56,000  1,530 

Other  unenumerated  Articles     3,000,000  2.50,000  75,000 

Total 58,829,000  18,494,000  929,865 

Foreign  Articles  for  Consumption  as  Imported. 

Articles.                     Value  in  Dolls.  Dutis  in  Dolls.        Freights  in  Dnlla. 

Coffee 5,380,000  Free.  943,580 

Tea 4,809,000  Free.  343,000 

Sugar  [proportion  of] 2,024,000  1,067,000  375,000 

Wines 1,493,000  1,292,000  111,925 

Spirits 1,09.5,000  1,554,000  109,.500 

Fruits  and  Spices 1,480,000  560,000  124,000 

Molasses  [proportion  of]...    1,000,000  300,000  280,000 

Salt 883,000  678,000  247,000 

Coal 188,000  130,000  188,000 

Fish 300,000  50,000  30.(100 

Beer,  Ale,  and  Porter 90,000  19,000  8,000 

Other  unenumerated  Articles  1,500,000  89,000  225,000 

Total 20,242,000  5,735,000  2,985,005 

Foreign  .Articles  for  Manufacture  in  the  United  States. 

Articles.                       Value  ii  D'llis.  Duties  n  Dolls.        Freights  in  Dolls. 

Sugar  [proportion  of] 2,02.5,000  1,510,000  562,500 

Molas.'jes  [proportion  of]....   2.072,000  591,000  450,000 

Iron  [proportion  of] 2,966.000  1,401,000  415,000 

Steel   750,000  97,000  25,000 

Hides  and  Furs 4,706,000  332,000  610,000 

Copper  and  Brass 1,951,000  Free.  140,000 

Mahogany 248,000  40,000  49,600 

Wool.". 1,667,000  123,000  330,0.50 

Rags 416,000  27,000  75,000 

SaUpetre 486.000       .  Free.  245,000 

Hemp 483.000  173,000  78,000 

Indieo 768,000  53,000  15,000 

Dye-stuffs,  &c 294,000  Free.  190,000 


ON    THE    INTERESTS    OF    COMMERCE    AND    NAVIGATION.     447 

is  beneficial  to  navigation  is  so  to  commerce;  and  for  the  most 
part,  and  in  the  long  run,  it  is,  though  the  evidence  is  not  all  of  the 

Articles.  Value  in  Dolls.  Duties  in  Dnlls.      Freiglits  in  Dolls, 

Bristles 178,000                           3,000  4,000 

Camphor 143,000  35,000  3,000 

Dye-Woods 337,000                          Free.  50,000 

Linseed 369,000  19,000  205.000 

Raw  Silk 710,000  173,000  12,000 

Other  unenumerated  Articles.  2,000,000  100,000  295,000 

Total 22,569,000  4,677,000  3,754,150 

Recapitulation. 

Valiip  ill  Diilla.  Duties  ill  DnIIg.    Freights  in  Dnlls. 

Foreign  Manufactured  Articles...  58,829,000  18,494,000  £29,865 

Foreign  Articles  ibr  Consumption.   20,242,000  5,735,000  2,985,005 
Foreign  Articles  for  Manufacture 

in  this  Country 22,569,000  4,677,000  3,754,150 

Aggregate 101,640,000  28,906,000  7,669,020 

"Now,  sir,  I  have  said  that  changes  have  taken  place  in  the  foreign  trade  of 
the  country  since  the  enlargement  of  the  manufacturing  s5'stem  of  the  United  States, 
which  were  naturally  to  be  expected.  And  I  think  it  was  suggested  the  other  day, 
by  my  friend  from  Vermont,  near  me  (Mr.  Phelps),  that  a  common  and  great  mis- 
take is,  that  we  do  not  accommodate  our  legislation  to  the  changing  circumstances 
of  the  country;  and  that  we  think  that  we  can  go  back  to  where  we  were  years 
ago,  without  disturbing  any  interests,  except  those  immediately  affected  ;  whereas, 
such  is  the  connexion  and  cohesion,  and  so  closely  are  all  these  interests  united, 
that  there  comes  to  be  a  complexity  and  mutual  dependence,  and  there  is  no  dis- 
turbing one  great  branch  of  the  system  without  injury  to  all  the  rest.  Here  is  a 
table  of  our  trade  with  South  America,  and  beyond  the  capes,  with  a  comparison  of 
that  trade,  in  the  year  1828  and  the  present  year : — 

Comparison  of  our  Trade  with  Places  beyond  the  Cape  of  Good  Hope,  and  South 

America. 
Imports  value         Domestic  Exports,   Tons  of  ship- 
In  1828.  in  Dolls.  value  in  Dolls,      ping  employ'd. 

Dutch  East  Indies 113,000  83,000  1,454 

British  East  Indies 1,543,000  55,000  2,589. 

Manilla 60.000  20,000  829 

China 5.340.000  230,000  9,900 

Buenos  Ayres  and  Montevideo 317,000  94,000  1,363 

Brazils 3,009,000  1,505,000  24,482 

Other  South  American  Ports 1,904,000  1,776,000  8,672 

Total 12,286,000  3,763,000  49,291 

In  1845. 

Duteh  East  Indies 935,000  98,000  4,900 

British  East  Indies 1,650,000  338,000  10,479 

Manilla 725,000  92,000  6,636 

China 4,931,000  1,110,000  15,035 

Buenos  Ayres  and  Montevideo ],.56l,000  6tO,000  17,300 

Brazils 6,883,000  2,409,000  48,550 

Other  South  American  Ports 8,434,000  2,574,000  19,747 

Total 21,519,000  7,257,000  122,647 

Increase 75  per  cent.  90  per  cent.         150  per  cent. 


448  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

same  class.     Nor  is  the  benefit  of  a  foreign  commerce  to  the  coun- 
try to  be  determined  by  the  gross  amount  of  imports  and  exports, 

"This  double  increase  of  tonnage  employed  over  the  increase  in  the  value 
of  imports,  is  owing  to  the  present  importation  of  the*  coarse  and  bulky  articles  for 
manufacture,  instead  of  manufactured  silk  and  cotton  goods  of  China,  Manilla, 
and  Calcutta. 

"  To  be  more  particular,  we  now  give  a  general  description  of  the  goods  im- 
ported from  those  places  in  the  year  1828,  viz. : — 

Manufactured  Cotton  Goods .  .$  1,04 1,000    Teas $1,800,000 

Manufactured  Silk  Goods. . . .  2,627,000    Wool 18,000 

Indigo  [which  was  imported  Coffee 1,700,000 

for  export] 1,030,000    Specie.   '  •  •  •  1,000.000 

Hides 1,040,000     Unenumerated  Articles 1,096,000 

Sugar 284,000  


Copper,  in  Pigs  and  bars 650,000         Total 12,286,000 

In  1845,  viz. :—  Linseed $300,000 

Manufactured  Cotton  Goods.        $1,500    Gunny  Bags 110,000 

Manufactured  Silk  Goods 150,000    Drugs  and  Dye-Stuffs 150,000 

Indigo 660,000    Ginger 40,000 

Hides 3,600,000    Cocoa 170,000 

Sugar 419,000    Spices 15,000 

Copper,  Pigs  and  Bars 365,000    Hemp 248,000 

Teas 4,075.000    Specie 1,200,000 

Wool 563,000    Unenumerated  Articles 2,381,000 

Coffee 6,600,000  

Saltpetre    500,000         Total 21,519,000 

"  It  is  thus  apparent  that  the  increased  employment  of  our  tonnage  of  one  hun- 
dred and  fifty  per  cent,  in  this  distant  transport,  has  been  from  the  importation  of 
the  raw  materials  for  manufacture  in  our  country,  and  of  the  increased  quantities 
of  coffee  and  teas,  and  no  doubt  increased  exportation  of  our  domestic  products  to 
those  distant  places  has  been  promoted  by  this  increase  in  imports.  Those  domes- 
tic products  were  manufactured  cotton  and  woollen  goods,  lumber,  and  articles  of 
furniture,  provisions  of  all  kinds,  naval  stores,  cotton,  tobacco,  ice,  candles,  &c.,  &,c. 

"I  have  another  table,  Mr,  President,  exhibiting  our  trade  with  the  north  of 
Europe,  presenting  the  same  general  result,  and  as  we  have  ceased  to  import  hemp 
to  a  great  extent  from  Russia,  the  increase  in  the  tonnage  is  principally  from  ex- 
portations  : — 
"Comparison  of  our  Trade  with  the  North  of  Europe,  viz. :  Russia,  Sweden,  Ger- 
many, and  Holland,  showing  a  falling  off  in  the  Imports. 

In  the  year  1828 $11,214,000 

In  the  year  1845 4,059,000 

Decrease  of 7,155,000 

And  an  increase  in  our  Domestic  Exports  of — 

In  the  year  1828 $5,085,000 

In  the  year  1845 6,346,000 


Increase  of 1,261,000 

And  an  increase  in  the  Tonnage  employed  of — 

In  the  year  1828 136,100  tons. 

In  the  year  1845 197,000  tons. 


Increase 60,900  tons. 


OS  THE. INTERESTS  OF  COMMERCE  AND  NAVIGATION.         449 

any  more  than  the  gross  amount  of  a  spendthrift's  costs  of  living 
and  income  will  prove  his  prosperity,  so  long  as  his  expenditures 

"  This  increase  is  from  the  transport  of  our  domestic  exports  to  those  places. 

"  It  will  be  interesting  to  note  some  of  the  articles  of  import  from  those  places, 
in  which  that  reduction  strikingly  appears. 

In  1828.  In  1845. 

Manufactures  of  Cotton  and  Flax $2,190,000  $165,500 

Manufactures  of  Iron  and  Steel 2,204,000  677,000 

Manufactures  of  Glass 458,000  128.000 

Manufactures  of  Leather 330,000  2.100 

Manufactures  of  Sail  Cloth.    345,000  186,000 

Manufactures  of  Linseed  Oil 130,000  13,000 

Manufactures  of  Cordage 145,000  54,000 

Unmanufactured  Hemp 990,000  21 1,000 

Unmanufictured  Flax 37,000  31,000 

Unmanufactured  Wool 97,000  31,000 

Unmanufactured  Rags None.  12,000 

Total 6,926,000  1,510,000 

"Thus  showin?  a  reduction  in  the  manufactured  goods,  hemp,  &c.,  imported 
from  those  countries,  of  more  than  three  fourths  of  the  whole  amount. 

"These  facts  are  certainly  of  importance  in  considering  the  employment  of  our 
shipping  in  the  transport  of  raw  material,  such  as  cotton,  flax,  hemp,  iron,  coal,  &c., 
coastwise  in  our  own  country,  for  the  manufacture,  in  our  country,  of  good?  which 
have  taken  the  place  of  the  foreign  manufactured  goods,  imported  and  consumed 
by  us,  16  years  ago. 

"  A  very  important  fact  in  connexion  with  this  part  of  the  subject  is,  that  this 
distant  trade  is  in  our  own  vessels.  It  is  divided  by  none.  We  know  tliat  in  the  trade 
between  us  and  England,  about  a  third  of  the  navigation  is  in  the  hands  of  Eng- 
land. But  in  the  trade  with  the  north  of  Europe,  &c.,  the  trade  ie  on  American 
account,  and  to  our  advantage;  and  to  a  great  extent,  also,  we  pay  for  the  impor- 
tations by  domestic  products.  We  do  not  now  hear  of  any  extraordinary-  amounts 
of  specie  to  meet  the  demands  of  thi~:  trade,  because  the  productsof  our  own  indus- 
try and  our  own  people,  in  a  manufactured  state,  are  carried  out. 

"  It  is  obvious,  sir,  that  for  the  same  reason  that  the  raw  material  imported  for 
the  manufacturer  pays  a  large  proportion  of  freight,  articles  of  export  of  like  na- 
ture from  our  side  for  the  same  purpose  pay  also  a  large  proportion,  as  everybody 
knows  is  the  case  with  cotton.  And  this  proves  that,  in  every  measure  concern- 
ing the  interests  of  navigation,  we  should  consult  rather  the  great  and  bulky  arti- 
cles, than  the  small,  where  the  value  is  sreat  and  the  bulk  diminished. 

"  Now,  be  pleased  to  notice  these  results.  Fifiy-eight  millions  of  dollars  of  man- 
ufactured goods  imported,  yield  less  than  one  million  for  freight.  Twenty-two 
millions  of  dollars  brought  in  articles  to  be  manufactured  here,  yield  three  millions 
and  three  quarters;  being,  very  nearly,  one  half  of  all  the  freight  earned  on  all 
our  imports.     Certainly,  this  is  a  most  important  fact,  and  worthy  of  all  attention. 

"We  propose,  then.  Mr.  President,  in  the  first  place,  to  diminish  and  discourage 
labor  and  industry  at  home,  by  taxing  the  raw  materials  which  are  brought  into 
the  country  for  manufacture.  We  propose,  in  the  second  place,  to  diminish  the 
earnings  of  freight  very  materially,  by  diminishing  the  importation  of  bulky  arti- 
cles, always  brought  in  our  own  ships.  We  propose,  in  the  third  place,  to  diminish 
the  amount  of  exports  of  our  own  domestic  manufactured  goods,  by  refusing  to  lake 
in  exchange  for  them  raw  materials,  the  products  of  other  countries.     This  is  our 

29 


450        THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

are  'ireater  than  his  receipts.     The  Free-Trade  doctrine  is,  that 
the  spendthrift  is  growing  rich. 

But  it  is  no  matter  to  navigation,  as  a  distinct  interest,  what  work 
it  is  en"-a"-ed  in,  so  it  has  work  ;  or  what  it  carries,  if  it  has  enough 


"0"i=) 


to  carry.  It  might  also  he  said,  with  a  qualification,  that  it  is  no 
matter  to  importing  merchants,  for  the  time  being,  how  much  more 
they  bring  into  the  country  than  is  carried  out,  of  other  commodi- 
ties than  money,  if  they,  personally,  have  time  to  wind  up,  and 
get  out  of  harm's  way,  before  the  country,  as  a  whole,  is  compelled 
to  settle  the  balances  against  it  in  cash.  They  may  even  get  rich, 
and  retire  on  princely  fortunes,  if  they  retire  soon  enough,  while 
the  country  is  plunged  into  general  bankruptcy,  and  the  masses  of 

present  policy  !  This  is  our  notion  of  Free  Trade  !  Surely,  surely,  Mr.  President, 
this  enlightened  system  can  not  fail  to  attract  the  admiration  of  the  world  ! 

"  Now,  sir,  one  can  not  say  to  what  extent  this  change  of  system  may  affect  the 
navisation  of  the  country,  but  its  tendency  is,  unquestionably,  to  cripple  and  cramp 
the  navigating  interest.  Its  tendency  is  to  diminish  the  demand  for  tonnage, 
for  naviiration,  for  the  carrying  trade.  And  I  think  I  might  on  this  occasion,  with- 
out iitipropriety,  call  the  attention  of  the  senator  from  Maine,  farthest  from  me 
[Mr.  Fairfield],  a  gentleman  who  here  represents  a  state,  if  not  first,  at  least 
among  the  very  first,  in  regard  to  the  amount  of  its  navigation.  The  ships  of 
Maine  are  found  in  every  quarter.  They  are  round  the  capes,  and  in  the  north 
sea.  They  bring  home  these  raw  materials  ;  and  everything  that  diminishes  the 
consumption  of  these  raw  materials  in  our  own  country,  diminishes  the  chances  of 
employment  to  every  ship-owner  in  the  state  of  Maine.  I  will  read  an  extract  or 
two,  from  a  letter  which  I  have  received  on  this  subject : — 

Baltimoke,  2()th  July,  1846. 
'"Sir:  I  notice  that  the  new  tariflT  bill  has,  in  its  schedule,  silk,  mahogany, 
hides,  brazette  wood,  logwood,  fustic,  Rio  Hache  wood,  Lima  wood.  Sandal  wood, 
red  cedar,  pig  copper,  nitrate  of  soda,  or  tiie  sal  soda  of  Peru,  saltpetre,  block,  and 
all  sorts  of  crude  woods,  and  many  drugs  of  bulk,  all  more  or  less  dutiable,  and  tea 
and  coffee  left  free. 

"  '  This  is  curious  Free  Trade. 

"'These  are  the  articles  that  give  our  vessels  homeward  freights,  and  being 
chiefly  gross  articles  of  great  bulk,  they  appeal  most  strongly  to  be  phiced  in  the 
free  list.  You  know  very  well  that  our  outward-bound  vessels  to  the  English 
islands  can  get  no  sort  of  return  cargo  unless  they  go  to  Cuba  or  Porto  Rico  for 
sugar  or  molasses,  or  else  to  some  salt  port,  or  bring  home  some  sort  of  wood  or 
hides  from  St.  Thomas,  or  the  Main.  I  speak  of  small  vessels  that  trade  to  the 
West  Indies  and  the  Spanish  Main. 

"  '  Gross,  crude  articles,  of  this  sort,  aid  shipping  interests,  and  assist  making  up 
cargoes  to  Europe  of  various  such  articles  if  free,  such  as  logwood  particularly, 
and  Brazillelto  and  Rio  Hache  wood  in  cotto^i-ships  even  for  dunnage. 

"'I  call  Free  Trade  tlie  policy  that  lets  crude  articles  in  free  as  in  "old  times." 
"  '  As  far  as  I  can  judge,  and  being  myself  engaged  in  shipping  interests,  I  think 
this  bill  very  unfriendly  to  such  interests;   and   as  to  being  a  Free-Trade  bill,  it  is 
anything  else,  as  I  understand  Free-Trade,  as  to  the  articles  named. 

" '  I  am,  dear  sir,  your  friend  and  fellow-citizen,  William  Miles.'  " 

Comment  on  such  facts  and  such  an  argument  is  entirely  superfluous. 


ON    THE    INTERESTS    OF    COMMERCE    AND    NAVIGATION.     451 

the  community  are  involved  in  the  deepest  commercial  distress 
induced  by  them.  Hence  importing  merchants  are  generally  in 
favor  of  Free  Trade,  with  a  few  honorable  exceptions.  They  care 
nothing  about  the  country,  if  they  can  only  gain  a  position  that 
shall  fortify  them  against  the  common  calamities  which  they  them- 
selves, by  their  cupidity,  have  brought  upon  the  masses  of  the  peo- 
ple, and  whicb  the  people  must  bear. 

But  it  need  not  be  said  that  a  public  policy,  regulating  foreign 
commerce,  well  devised  and  properly  adjusted,  is  not  designed  to 
give  a  few  importing  merchants  —  more  than  half  of  them  foreign 
factors,  who  pay  no  taxes,  and  carry  away  the  money  of  the 
country  —  a  control  over  the  fortunes  of  millions  of  the  American 
people,  and  to  enrich  such  cormorants,  while  it  impoverishes  the 
nation.  Mr.  Clay  said  well  and  truly,  as  long  ago  as  1810,  in  his 
first  speech  in  the  senate  of  the  United  States  on  the  protective 
policy,  "  Dame  Commerce,"  meaning,  doubtless,  these  importing 
merchants,  "  is  a  flirting,  flippant,  noisy  jade,  like  the  wife  who 
wished  her  husband  to  supply  his  table  from  the  cook  over  the  way, 
rather  than  have  the  cooking  done  at  home  in  the  kitchen."  She 
did  not  like  the  trouble,  nor  the  clatter,  nor  the  smell.  It  was  for 
her  benefit,  and  not  for  that  of  the  family,  that  she  argued.  So 
with  importing  merchants.  They  want  Free  Trade  to  enrich  them- 
selves, though  it  makes  the  nation  poor.* 

There  is  no  doubt  that  Free  Trade,  or  an  approximation  to  it, 
between  the  United  States  and  foreign  parts,  by  an  abandonment  of 
the  protective  policy  on  our  part,  will,  for  a  short  season,  increase 
the  gross   amount  of  imports  and   exports,   or  enlarge  the  gross 

•  Apart  from  return  cargoes,  in  a  regular  exchange  of  commodities,  our  import- 
ing business  is  chiefly  done  by  foreigners.  They  send  their  agents  here,  who,  by 
their  intimate  relations  and  a  secret  understanding  at  home,  are  able  to  supplant 
American  merchants,  to  defraud  our  revenue  by  false  invoices,  and  thus  to 
crush  those  very  American  interests  which  were  designed  to  be  protected  by  the 
laws  they  violate.  See  Senate  Doc,  No.  83,  2d  session,  27th  Congress,  for  proof 
of  fraud  in  the  agents  of  mie  English  house,  to  the  amount  of  some  hundreds  of 
thousands  of  dollars.  Also  a  voluntary  fine  of  eighty-six  thousand  dollars,  paid  by 
seven  agents  of  British  houses,  to  Mr.  Hoyt,  collector  of  New  York,  to  compromise, 
and  purchase  exemption  from  the  course  of  justice — and  a  variety  of  other  evidence 
of  the  same  kind — a  mere  index  to  the  vast  frauds  that  have  been  practised  upon 
upon  us  with  impunity.  In  1842,  and  before  the  tariff  of  that  year  went  into 
effect,  74  per  cent,  of  the  imports  into  the  city  of  New  York,  and  19  per  cent,  of 
those  into  Boston,  were  on  foreign  account;  and  foreigners,  of  course,  had  all  the 
profits;  whereas,  in  184.5,  it  appears  that  by  the  operation  of  the  tariff  of  1842, 
the  importing  business  in  New  York,  on  foreign  account,  had  been  reduced  to  44 
per  cent,  of  the  whole,  and  in  Boston  to  9  per  cent.  It  is  now  again,  under  the 
tariff  of  J  846,  rapidly  reverting  to  foreigners. 


452  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

amount  of  commerce,  when  reckoned  in  dollars  and  cents,  though 
not  in  the  employment  of  a  greater  amount  of  shipping.  The 
great  demand  for  shipping  in  the  winter  of  1846-'47,  was  owing 
entirely  to  the  extraordinary  scarcity  of  food  in  Europe,  and  can 
not  safely  be  set  down  as  a  permanent  rule.  It  would  have  been 
the  same  under  any  tariff,  and  under  any  policy,  as  a  providential 
and  unusual  effect.  The  ordinary  effect  of  the  abatement  or 
abandonment  of  the  protective  policy,  as  proved  in  the  tables  and 
other  facts  exhibited  in  our  citations  from  Mr.  Webster,  is  to  di- 
minish the  demand  and  use  for  shipping,  and  to  lay  it  up;  while 
the  continuance  of  that  policy  increas.es  both.  Such  has  always 
been  the  case  in  our  commercial  history.  In  farther  confirmation 
of  the  above  alternative,  take  the  following  additional  f\icts  :  Under 
the  tariff  of  1842,  American  boot  and  shoe  makers  were  protected, 
giving  rise  to  large  importations  of  hides  —  a  heavy  article  —  which, 
in  1845,  amounted  to  near  four  millions  of  (lolUirH,  giving  employ- 
ment to  American  shipping,  as  well  as  to  American  boot  and  shoe 
makers.  This  one  fact  will  illustrate  scores  of  other  like  cases, 
which  operated  in  the  same  way  under  the  tariff  of  1842,  giving, 
at  the  same  time,  employment  to  American  shipping,  and  to  Amer- 
ican labor.  It  is  the  raw  material  that  makes  freight.  Manufac- 
tured goods  make  little.  It  may  be  well  to  remark,  however,  in 
this  place,  that  our  exports  of  boots  and  shoes,  under  the  tariff  of 
1842,  had  risen,  in  1845,  to  the  amount  of  S330,000,  and  the  ex- 
ports of  articles  of  American  manufactures,  of  the  same  year,  to 
about  $12,000,000,  being  more  than  one  tenth  of  all  our  exports, 
also  augmenting  foreign  trade  in  the  best  way  possible,  by  substi- 
tuting exports  of  our  own  products  for  imports  of  foreign  and  for 
re-exportations  of  foreign.  ^ 

But  it  is  alleged  that  the  protective  policy  diminishes  foreign 
commerce.  Though  there  may  have  been,  for  a  time,  larger  im- 
portations in  periods  of  low  duties,  or  no  duties  in  this  country, 
there  was  not  really  more  foreign  trade,  nor  in  fact  so  much,  by  a 
great  deal,  as  during  the  periods  of  protective  duties,  take  those 
periods,  respectively,  through  and  through.  Like  the  well-to-do 
farmer,  who  begins  to  buy  more  than  he  sells,  and  soon  gets  out 
of  money  and  out  of  credit  —  who  does  indeed  for  a  little  while 
trade  largely,  to  his  own  ruin — so  has  it  always  been  with  this 
country  in  times  of  Free  Trade.  The  moment  duties  were  relaxed, 
importations  increased,  and  there  seemed  to  be  a  more  active  for- 
eign trade.     Really,  however,  there  was  no  more  request  for  navi- 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.      453 

gating  craft  —  nor  so  much  —  inasnnuch  as  the  additional  importa- 
tions were  costly  manufactured  goods,  of  little  weight.  As  soon 
as  the  country  got  in  debt,  lost  credit,  and  was  forced  to  buy  less, 
the  navigating  craft  had  less  employment,  and  was  much  of  it 
hauled  off,  and  laid  up.  The  foreign  commerce  of  the  country 
was  injured  and  diminished.  Whereas,  under  the  protective  sys- 
tem, in  all  cases,  foreign  commerce  has  been  more  uniform  and 
uniformly  increasing;  shipping  has  had  better  and  more  employ- 
ment, and  navigation  has  rejoiced  in  its  business  and  profits  — 
never  more  than  for  a  few  years  after  the  tariff  of  1S24;  and  never 
more  than  under  the  tariff  of  1842.  All  the  boasted  increase  of 
foreign  trade,  under  low  duties  and  no  duties,  has  been  the  ruinous 
increase  of  a  spendthrift,  that  brings  debt,  loss  of  credit,  poverty, 
want,  distress,  in  its  train  —  beginning  with  flushed  hope,  and  end- 
ing in  disappointment. 

The  most  important  view  of  foreign  commerce,  under  the  two 
systems,  respectively,  of  low  anti-protective  and  protective  duties, 
may  be  stated  thus  :  that  the  former  system  leads  directly  and  uni- 
formly to  excessive  importations,  or  excessive  buying,  leaving  a 
balance  against  the  country,  to  be  settled  by  drawing  away  its 
money,  and  leaving  the  people  without  a  currency  ;  and  in  this 
way  embarrassins:  and  diminishinsj  commerce.  It  was  so  under 
the  colonial  system  ;  the  money  all  went  to  England.  It  was  so 
under  the  confederation  ;  the  money  all  went  abroad,  chiefly  to 
England,  to  settle  balances,  because  we  bought  more  than  we  sold. 
The  states,  severally,  then,  possessed  the  only  power  to  establish  a 
protective  policy,  each  for  itself;  and  being  unable  to  do  it,  with- 
out collision  of  interests,  it  resulted  in  a  system  of  ■perfect  Free 
Trade,  and  of  complete  commercial  ruin.  It  appears  by  Mr.  Sec- 
retary Woodbury's  annual  report  to  Congress,  of  1S40,  that  the 
imports  into  the  country,  for  the  first  two  years  after  the  peace  of 
1814,  exceeded  the  exports  by  $126,466,0-59.  How  could  the 
country  pay  such  a  balance,  already  deeply  in  debt  as  it  was,  when, 
in  its  best  estate,  there  was  not  half  so  much  money  in  the  country? 
The  tariff  of  1816,  in  its  most  important  protective  provisions, 
defective  at  best,  and  of  a  brief  term,  did  but  little  toward  the  set- 
tlement of  the  immense  balance  that  had  previously  accumulated 
against  the  country;  and  by  the  failure  of  the  tariff  bill  of  1820, 
the  country  was  doomed  to  run  on  again,  under  a  system  of  low 
anti-protective  duties,  till  the  tariff  of  1824  arrested  it.  According 
to  Mr.  Secretary  Woodbury's  report  to  Congress,  in   1840,  the 


454  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

balance  of  foreign  trade  against  the  country  for  1815,  was  sixty-one 
millions  of  dollars;  in  ISIG,  it  was  sixty-five  millions;  in  1817, 
twelve  millions :  in  1818,  more  than  twenty-eight  millions ;  in 
1819,  seventeen  millions;  in  1820,  about  five  millions;  in  1821, 
two  millions  in  our  favor ;  in  1822,  eleven  millions  against  us  ;  in 
1823,  about  three  millions  against  us  ;  and  in  1824,  nearly  five  mil- 
lions. 

What  country  could  stand  up  against  such  odds  ?  And  all  this 
in  uninterrupted  succession,  without  any  chance  to  pay.  The  na- 
tion writhed  and  groaned  under  it.  Its  money  gone  abroad  to 
pay  debts;  banks  suspended;  the  circulating  medium  become 
scarce,  nobody  knowing  what  it  was  worth,  for  it  was  irredeemable; 
business  of  all  kinds  in  trouble  ;  property  of  every  description 
depreciated  ;  and  labor  unemployed  and  starving.  Who  that  is 
old  enough  to  remember  those  years,  will  not  certify  to  Mr.  Clay's 
picture  of  them,  in  his  answer  to  General  Hayne,  in  1832,  as  "  ex- 
hibiting a  scene  of  the  most  widespread  dismay  and  devastation"  ? 

But,  from  the  date  of  the  tariff  of  1824,  when  the  protective 
policy  was  for  the  first  time,  in  the  history  of  the  country,  well 
established  —  and  from  which  time  it  continued  till  the  duties  went 
down  again  under  the  Compromise  act  of  1833  —  the  prosperity 
of  the  country  was  restored;  labor  found  employment  and  reward; 
private  and  public  wealth  increased  ;  the  entire  national  debt  of 
one  hundred  and  sixty  millions  of  dollars,  left  at  the  end  of  the  war 
of  1812,  was  at  last  paid  off  in  1836,  and  thirty-seven  millions  of 
surplus  funds  in  the  national  treasury  were  distributed  among  the 
states.  In  those  years  commerce  spread  its  wings  over  all  seas, 
was  widely  extended,  greatly  enlarged,  and  prosperous. 

But,  behold  the  contrast,  as  the  duties  under  the  Compromise 
act  descended  below  the  protective  standard,  and  approximated 
toward  a  system  of  Free  Trade,  till  finally  they  came  down  to  a 
maximum  of  20  per  cent.  The  excessive  importations  commenced 
as  soon  as  President  Jackson  began  to  show  his  hostility  to  the 
protective  policy,  and  continued  down  through  the  administration 
of  Mr.  Van  Buren,  who  "followed  in  the  footsteps  of  his  illustrious 
predecessor."  The  balance  accumulated  against  the  country  in  its 
foreign  trade,  in  nine  successive  years  under  General  Jackson  and 
Mr.  Van  Buren  —  including  three  of  the  latter's  administration  — 
according  to  the  records  of  the  treasury  department,  was  more  than 
two  himdred  and  fifty  millions  of  dollars.  The  largest  balance 
was  in  1836,  being  sixty-one  millions.     The  next  largest  was  fifty- 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       455 

nine  millions,  in  1S39  ;  the  next  in  comparative  magnitude,  was 
twenty-eight  millions,  in  1835  ;  twenty-tliree  millions  in  1837  ; 
twenty-two  in  1834 ;  and  so  on.  Nor  is  this  all.  It  appears,  by 
Fisher's  National  Magazine,  for  August,  1845,  p.  279,  that,  for 
fifteen  years,  from  1830  to  1844,  inclusive,  the  unenumerated  arti- 
cles of  imports  amounted  to  one  hundred  and  fj'tij  milUons  of  dol- 
lars, being  an  average  often  millions  a  year,  which,  fairly,  should 
be  added  to  the  above  balances.  That  these  balances  were  real, 
and  not  fictitious,  is  proved  from  the  fact,  that,  at  the  end  of  this 
tlisastrous  period,  the  foreign  debts  of  the  country,  actually  ascer- 
tained, were  found  to  be  upward  of  two  hundred  millions  of  dollars, 
most  of  them  public.  The  state  debts — most  of  them  abroad  — 
were  reported  to  Congress  by  the  secretary  of  the  treasury,  in 
1842,  as  $200,855,793.  A  vast  amount  of  other  foreign  debts, 
no  small  fraction  of  them  private,  and  paid  by  bankruptcy,  were 
unascertainabie,  swelling  the  aggregate  much  above  the  common 
estimate.  "A  Southern  Planter,"  in  his  "  Notes  on  Political  Econ- 
omy," estimates  the  foreign  debt  of  the  people  and  states,  in 
1844,  diijour  Imndrcd  and  Jiff  )j  mlUions.,  viz.,  two  hundred  millions 
of  state  debts;  two  hundred  millions  of  bank,  and  corporation,  and 
national  stocks;  and  fifty  millions  of  private  debts  —  all  owned 
abroad  —  drawing  the  interest  annually  from  the  country,  for  all 
that  bankruptcy  and  repudiation  had  not  kept  back.  He  says, 
*'it  is  enough  to  weigh  down  our  industry  for  the  next  fifty  years." 

Here,  then,  is  another  result  of  a  protracted  period  of  low,  anti- 
protective  duties — a  result  of  stupendous  magnitude,  impoverish- 
ing the  people,  the  country,  and  the  government,  till  neither  had 
credit  abroad,  or  at  home,  and  till  all  were  plunged  in  one  common 
ruin.  Commerce,  domestic  and  foreign,  withered  under  it,  and 
was  blighted.  Who  does  not  know  this  ?  Who  could  ever  forget 
it?  And  will  any  one  arraign  the  assigned  cause  as  questionable, 
when  he  always  finds  the  same  results  after  the  same  antecedents? 

And  behold  the  effects  of  tlie  protective  duties  of  the  tariff  of 
1842.  The  balance  of  trade  instantly  whirls  about,  and  is  in  favor 
of  the  country  ;  twenty  millions  of  specie  return  in  one  year  in 
excess  of  the  exports  of  it ;  commerce  spreads  its  wings  again,  and 
flourishes  to  an  unexampled  extent;  navigation  finds  full  employ- 
ment; private  and  public  prosperity  is  revived  ;  business  and  credit 
revive;  labor  everywhere  finds  work  and  meets  with  a  satisfactory 
compensation  ;  the  ruin  of  many  years  is  rej)aired  in  four  :  all  are 
prosperous,  all  happy,  all  satisfied,  and  the  nation  is  advancing  with 


456       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

rapid  strides,  in  wealth,  greatness,  and  strength.  Will  any  one 
doubt  what  is  the  cause? 

The  following  mode  of  proof  on  this  point,  though  little  required 
after  the  above,  is  well  worth  presenting  as  another  species  of  de- 
monstration—  for  it  is  nothing  less:  — 

It  appears  by  the  treasury  documents,  that  the  aggregate  of  dutia- 
61e  im[)orts  from  1821  to  1S24,  inclusive,  four  years  of  low  duties, 
were  S264, 900,000,  an  average  of  sixty-six  millions  annually.  The 
average  rate  of  duty  on  these  articles  was  about  34  per  cent. ;  and 
the  aggregate  revenue  for  this  term  of  four  years,  was  over  ninety 
millions.  By  the  tariff  of  1824,  the  average  duty  was  raised  to  38 
percent.;  the  aggregate  imports  of  dutiable  articles  for  the  first 
four  years,  were  $301,550,000,  being  an  annual  average  of  about 
seventy-five  millions.  It  will  be  seen  by  these  facts,  that,  with  in- 
creased duties,  there  were  increased  importations  of  dutiable 
articles.  By  the  tariff  of  1828,  the  average  duty  was  raised 
to  about  41  per  cent.,  and  the  amount  of  dutiable  imports  for  the 
next  four  years  was  $297,330,000,  with  an  annual  average  of 
$74,330,000  —  scarcely  varying  from  the  preceding  four  years. 
As  both  periods  were  under  a  protective  policy,  the  results  ought 
to  be  similar.  The  next  nine  years,  from  1833  to  1841,  inclusive, 
under  the  compromise  tariff,  was  a  very  remarkable  period  of  bold 
and  excessive  importations,  exceeding  the  exports  for  that  time  by 
about  two  hundred  and  thirty-one  millions.  The  population  of  the 
country,  too,  had  increased  ;  and  it  was  natural  enough  thai  foreign 
trade,  as  a  whole,  should  have  been  augmented  during  this 
period,  when  the  average  duty,  from  beginning  to  end,  was  about 
31  per  cent.,  being  3  per  cent,  lower  than  the  first,  7  lower  than 
the  second,  10  lower  than  the  third,  of  the  abovenamed  periods. 
But  what  were  the  facts?  The  aggregate  of  dutiable  imports  for 
this  period  of  nine  years  was  six  hundred  and  thirty-one  millions, 
giving  an  annual  average  of  seventy  millions  against  seventy-four 
millions,  when  duties  were  10  per  cent,  higher.  But  this  does  not 
fully  exliibit  the  difference  in  the  effects  of  high  and  low  duties  on 
foreign  commerce,  without  considering,  that  the  exports  of  this  pe- 
riod were  two  hundred  and  thirty-one  millions  less  than  the  imports. 
That  makes  the  difference  in  the  comparative  results  startling. 
Under  the  tariff  of  1842,  it  is  sufficient  to  say,  that  the  im- 
ports, free  of  duty,  fell  off  from  thirty  millions  in  1842,  to  twenty- 
two  millions  in  1845  —  the  fall  having  been  gradual  —  and  those 
paying  duty  (commonly  stated  at  an  average  of  40  per  cent.,  whereas 


ON   THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       457 

the  average  duty  of  the  tariff  of  1S42  was  only  34.64  per  cent.),  rose 
from  sixty-nine  millions  in  1842,  to  ninety-five  millions  in  1845  ; 
and  that  the  revenue  from  duties,  which  had  descended  to  less  than 
thirteen  millions  in  the  last  year  of  the  com])roinise  tariff,  rose  to  an 
annual  average  of  over  twenty-six  millions,  under  the  tariff  of  1842. 
The  facts,  that  during  this  period,  the  amount  of  imports  free  of 
duty  decreased,  and  those  paying  duty  under  a  well-adjusted  sys- 
tem of  Protection,  continued  to  increase  in  amount,  relatively  and 
positively,  take  the  period  as  a  whole,  and  doubling  the  revenue, 
are  conclusive  as  to  the  effects  of  protective  and  anti-protective  du- 
ties on  commerce  and  revenue.  Tlie  inference  is  fair,  that  Pro- 
tection gave  the  people  the  ability  to  purchase  the  protected  articles, 
which  they  got  cheaper  in  consequence  of  competition  between 
home  and  foreign  producers,  benefiting  themselves  as  consumers, 
benefiting  labor  by  giving  it  employment  and  good  wages,  benefit- 
ing commerce  and  navigation,  benefiting  the  country,  on  the  largest 
and  most  comprehensive  scale,  and  benefiting  the  government,  by 
paying  its  debts,  restoring  its  credit,  and  filling  its  treasury. 

The  farmer  who  keeps  up  good  fences,  pastures  only  his  own 
cattle,  and  keeps  his  crops  from  cattle  that  run  at  large,  so  that  they 
can  not  break  in,  will  be  likely  to  have  not  only  enougli  for  home 
consumption,  but  something  for  market.  And  if  he  takes  care  to 
sell  more  than  he  buys,  he  will  grow  rich.  If,  by  such  economy, 
his  annual  income  is  greater  than  his  expenses,  it  is  impossible  he 
should  fall  into  bankruptcy  ;  it  is  impossible  he  should  not  increase 
in  wealth.  He  has  then  a  substantial  capital  on  which  to  trade,  and 
if  he  follows  up  the  same  principles  of  economy,  in  all  his  business, 
he  will  be  able  to  do  more  and  more  business,  and  will  become 
richer  and  richer.  As  he  grows  rich,  his  wants  increase.  He  will 
buy  more,  because  he  is  able  to  buy,  pardy  for  taste,  partly  for  com- 
fort, and  pardy  to  augment  the  value  of  what  he  has.  It  was  the 
tariff  of  duties  which  he  imposed  on  himself  and  his  neighbors  — 
with  no  wrong  to  tliem,  and  certainly  with  great  benefit  to  himself 
—  it  was  this  tariff,  with  which  he  started  in  life,  that  has  made  him 
a  rich  man,  and  able  to  trade  largely  with  others;  and  it  is  the  same 
tariff  continued,  that  fortifies  his  position,  still  increases  his  wealth, 
and  still  extends  his  business.  Such  a  man  can  never  fail.  It  is 
impossible.  But  let  him  lay  aside  these  habits  of  self-protection 
and  economy  ;  let  him  throw  away  this  tariff;  let  him  begin  to  buy 
more  than  he  sells;  let  his  fences  go  down,  and  all  cattle  running 


45S  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

at  large  feed  in  his  pastures  and  on  his  crops  —  does  it  need  a 
prophet  to  tell  what  will  become  of  him  ? 

It  is  precisely  the  same  with  a  nation,  as  reason  and  all  experi- 
ence teach.  If  it  watches  over  and  protects  its  own  interests,  it 
will  "TOW  rich,  and  be  able  to  buy ;  and  having  the  means,  with 
the  multiplication  of  its  wants,  it  will  enlarge  its  commerce  with  for- 
eign parts.  As  a  man  of  small  means  will  not  buy  the  same  things, 
nor  so  much,  as  a  man  of  large  means,  so  is  it  with  a  nation.  A 
protective  system  will  give,  not  only  a  better,  but  a  more  extended, 
more  comprehensive,  larger,  and  more  diversified  foreign  com- 
merce, than  a  Free-Trade  system.  Look  to  the  case  of  the  farmer, 
above,  who  takes  care  of  his  home  interests.  Is  he  not  able  to  buy 
and  trade  more,  than  if  he  had  neglected  his  system  of  economy  ? 
Free  Trade  makes  a  nation  poor — especially  the  United  Stales  — 
as  has  been  shown.  How  can  a  poor  man,  or  a  poor  nation,  buy? 
The  protective  system  makes  a  nation  rich  —  none  more  than  the 
United  States.  It  makes  the  people  rich.  It  gives  to  every  man 
the  ability  to  purchase  foreign  luxuries.  When  a  man  grows  rich, 
he  has  new  wants,  and  those  wants  must  be  satisfied.  When  a  na- 
tion grows  rich,  its  wants  will  comprehend  the  productions  of  all 
parts  of  the  globe,  will  increase  in  number,  and  in  the  aggregate, 
and  in  the  same  proportion  will  enlarge  its  foreign  commerce.  Go 
to  Lowell,  Massachusetts,  and  see  wi)at  ranges,  what  whole  streets 
of  stores,  full  of  foreign  luxuries,  and  foreign  products,  are  required 
to  satisfy  the  wants  of  the  ten  thousand  operatives  in  the  manufac- 
tories of  that  city,  and  of  the  other  population  connected  with  them  ; 
and  let  it  be  remembered,  that  they  are  not  only  able  to  buy  them, 
but  to  grow  rich  on  their  wages.  From  this  cause,  the  importations 
of  cotton  goods,  of  the  finer  sorts,  paying  the  highest  duties,  were 
augmented,  under  the  tariff  of  1842,  and  for  three  years  ranged 
from  tc7i  to  thirteen  millions.  The  operatives  of  Lowell  support  a 
savings-bank  in  that  city  by  their  deposites,  and  many  of  them  be- 
come stockholders,  and  even  corporators,  in  the  establishments 
where  they  work.  In  one  company,  $100,000  of  the  stock  is 
owned  by  operatives ;  in  another,  $60,000  ;  and  so  on. 

Lowell,  in  these  particulars,  is  but  a  picture  of  the  whole  coun- 
try under  the  protective  system.  The  people  were  all  well  off,  and 
were  able  to  indulge  in  foreign  luxuries,  and  to  gratify  a  thousand 
wants,  which  could  only  be  supplied  by  foreign  commerce. 

The  position  of  American  labor  relative  to  foreign  labor,  and  of 
American  interests  relative  to  the  interests  of  foreign  nations,  would 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       459 

seem  to  have  been  entirely  overlooked  in  those  important  and  event- 
ful transactions  called  commercial  and  reciprocity  treaties  with  for- 
eign powers  ;  and  it  is  the  more  to  be  regretted,  as  they  can  not, 
like  acts  of  domestic  legislation,  be  at  any  time  repealed,  when 
found  to  operate  badly  ;  but  they  must  run  on  for  the  term  of  their 
stipulation,  be  it  a  greater  or  less  number  of  years,  till  custom 
grows  into  the  right  of  prescription,  and  the  great  interests  involved 
become  almost  invincibly  inclined  to  specific  and  accustomed  chan- 
nels. Ultimately,  the  claim  on  the  part  of  the  United  States  to 
revert  to  a  more  just  state  of  things,  when  the  great  injustice  of 
these  arrangements  shall  be  discovered,  may  be  the  occasion  of 
international  controversies  of  a  serious  character — perhaps  of  war. 
Foreign  powers,  which  enjoy  these  immunities,  will  not  desire  to 
tread  back  ;  for  they  are  too  well  aware  that  all  the  benefit  of  such 
treaties  is  generally  theirs,  and  all  the  loss  ours.  They  will  claim 
what  they  have  gained  as  a  prescriptive  right,  and  want  more. 

It  is  not  denied  that  a  commercial  treaty  might  be  made,  that 
would  be  just  and  beneficial  to  both  parlies,  when  the  United 
States  is  one  of  them  ;  but  we  are  not  aware  that  such  a  treaty  ever 
has  been  made.  It  is  doubtless  because  the  parties  in  negotiation 
assumed  the  principle  of  reciprocity  as  a  basis,  which  necessarily 
involves  the  principle  of  Free  Trade,  and  which  is  an  unjust  prin- 
ciple in  its  operation  on  the  United  States,  for  the  reasons  which 
have  been  before  elaborated  in  this  work.  No  matter  in  what 
mould  Free  Trade  be  cast,  it  will  never  answer  for  this  country, 
but  will  always  be  injurious.  It  is  equally  bad  to  have  it  go  into 
a  commercial  treaty,  based  on  the  principle  of  reciprocity,  as  to 
open  our  ports  directly  and  at  once  to  the  extent  of  the  stipulations 
of  such  a  treaty  ;  which,  as  will  be  seen,  is  a  mere  truism,  and  is 
in  fact  Free  Trade  to  the  same  extent.  It  is  singular  that  Amer- 
ican statesmen  and  diplomatists  generally,  if  not  without  exception, 
who  have  hitherto  been  concerned  in  these  transactions,  should 
have  been  so  blinded  to  the  great  principle  of  protection,  which,  in 
such  matters,  it  was  their  duty  to  vindicate  and  maintain,  but 
which  they  have  sacrificed,  apparently  as  if  they  did  not  understand 
its  application  in  the  premises.  "  Reciprocity"  seems  like  a 
very  fair  word,  a  very  just  thing ;  but,  when  it  means  nothing  more 
nor  less  than  Free  Trade,  as  it  does  in  all  commercial  treaties  be- 
tween the  United  States  and  other  countries,  it  is  very  unfair,  very 
unjust ;  because,  so  far  as  these  treaties  go,  in  their  practical  opera- 
tion on  us  as  a  party,  it  brings  American  labor  and  capital,  which 


460       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

together  cost  more  tlian  double,  into  a  direct  and  open  competition 
with  foreign  labor  and  capital.  It  has  been  seen  and  felt  that  it  . 
operated  unequally,  even  calamitously,  to  the  United  States;  the 
story  has  been  often  eloquently  told,  and  the  facts  cited,  showing 
how  unfortunately  it  works  ;  but  still  American  statesmen  and  di- 
plomatists go  on,  making  new  treaties  on  the  basis  of  the  same 
principle.  And  it  would  not  perhaps  be  strange  if,  in  this  way, 
we  should  by-and-by  find  ourselves  bound  hand  and  foot  to  the 
car  of  Free  Trade,  by  the  irrevocable  seal  of  commercial  treaties, 
with  all  nations.*  And  all  this  for  being  ignorant  of  the  fact  that 
a  reciprocify  treaty  is  a  Free-Trade  treaty.  Or  did  these  agents 
of  the  country  know  it  was  Free  Trade,  and  intend  it  as  such  ? 
"  What,  then,  shall  we  do?"  it  will  perhaps  be  asked.  The  an 
swer  is  as  short  as  the  question  :  Fall  back  on  the  platform  of  the 
law  of  nations,  which  is  broad  enough  and  strong  enough  for  all 
our  purposes,  so  long  as  other  commercial  nations  refuse  to  enter 
into  treaty  stipulations  that  will  vindicate  and  defend  the  rights  of 
American  labor  and  capital. 

After  the  peace  of  Ghent,  Great  Britain  adopted  measures  to 
exclude  the  navigation  of  the  United  States  from  her  colonies,  com- 
prehending a  trade  estimated  at  six  millions  of  dollars  ;  but  by  a 
clause  in  the  second  article  of  the  convention  of  London,  the  right 
of  a  countervailing  policy  was  left  open  to  the  United  States.  On 
the  basis  of  this  right,  an  effort  was  made  in  Congress,  in  1S16  and 

1817,  to  exclude  from  the  ports  of  the  United  States  all  foreign 
vessels,  British  or  other,  trading  with  those  British  possessions 
from  which  American  vessels  were  excluded,  with  a  view  to  force 
Great  Britain  to  a  reciprocity,  and  to  recover  those  rights  of  navi- 
gation for  American   shipping.     It   was   partially   successful.      In 

1818,  a  like  attempt  was  more  successful;  in  1820,  the  act  of 
1818  was  superseded  by  a  new  one;  and  so  again  in  1823  —  the 
design  of  each  of  which  was  to  bring  Great  Britain  to  terms.  At- 
tempts at  negotiation  were  made  under  the  administration  of  Mr. 

*  A  very  grave  constitutional  question  seems  to  be  involved  in  tiiese  transac- 
tions, viz.,  whether  the  treaty-making  power  can  lawfully  be  so  far  extended  as 
to  anticipate  and  bar  the  action  of  Congress  in  "  the  resulation  of  commerce  be- 
tween nations,"  and  in  the  enactment  of  revenue-laws.  The  first  of  these  powers 
is  clearly  wrested  from  the  legislative  department  of  the  government  by  commer- 
cial treaties,  and  the  effect  of  such  treaties  may  seriously  interfere  with  a  revenue 
system,  the  origination  of  all  the  measures  of  which  is  committed  to  the  house  of 
representatives  alone.  It  may  even  deprive  that  body  of  its  most  important  ground 
of  revenue.  In  this  way  foreign  powers  are  constituted  parties  to  American  rev- 
enue legislation. 


ON  THE  INTERESTS  OF  COMMERCE   AND  NAVIGATION.        461 

John  Q.  Adams,  but  the  death  of  the  British  prime  minister,  Mr, 
Canning,  put  tlie  question  into  new  hands,  and  deferred  a  settle- 
ment. In  1829,  Mr.  Louis  M'Lane  was  sent  to  London  by  Presi- 
dent Jackson,  with  instructions  on  this  subject;  the  question  was 
claimed  to  have  been  advantageously  settled,  and  the  transaction 
much  lauded  ;  the  practical  operation  of  which,  however,  made  it 
worse  than  it  was  before,  and  it  has  never  yet  been  satisfactorily 
arranged.  It  was  under  this  recijyrocify  treaty,  so  called,  negotiated 
by  Mr.  M'Lane,  that  events  have  transpired,  and  a  course  of  trade 
and  navigation  has  been  established,  between  the  United  States  and 
Great  Britain,  narrated  and  described  in  the  note  below,  being  an 
extract  from  the  National  Magazine,  January,  1846,  con)municated 
by  the  Hon.  James  Tallmadge.* 

*  "  All  these  great  questions  of  commerce,  in  all  their  consequences,  are  so  im- 
mediately connected  with   agriculture  and  a  market,  I  can  not  forbear  to  mention 
one  other  subject  of  great  and  commanding  importance  to  the  nation  —  I  mean  our 
numerous  reciprocity  treaties,  so  called.     It  is  the  misuse  of  the  term,  and  the 
permilted  abuse  of  those  treaties,  which  calls  for  remark  and  public  consideration. 
The  injuries  arising  from  those  treaties  are  very  great,  as  they  are  expounded  and 
carried  into  effect,  on  us.     Most  of  the  nations  of  Europe  have  colonies  in  differ- 
ent parts  of  the  ocean  —  the  East  or  West  Indies.     But,  to  be  brief,  I  must  illus- 
trate by  a  single  case.     Great  Britain  readily  makes  a  reciprocity  treaty  with  the 
United  States.     It  bespeaks  great  equality  and  mutual  kindness.     The  flags  and 
ships  of  each  other  are  put  upon  the  same  footing  in  each  other's  ports,  and  to  be 
received  without  distinction  or  discrimination.    It  looks  all  well.     In  practice,  un- 
der the  treaty,  an  American  and  an  English  vessel  load  at  Lcmdon  with  the  same 
goods,  and  come  in  together  at  one  of  our  ports.     The  duties  collected  must  be 
upon  the  goods,  and  no  difference  in  which  ship  the  goods  come.    This  country  has 
the  right,  and  so  has  England,  to  lay  whatever  duties  she  thinks  proper  on  the  itn- 
portation  of  the  goods  into  their  respective  ports.     England,  accordingly,  imposed 
a  rate  of  duties  on  produce  from  the  United  States,  so  high  as  to  be  a  prohibition 
and  a  rate  of  duties  on  like  articles  from  her  own  colonies,  so  low  as  to  be  nominal. 
The  effect  of  this  is,  that  the  American  and  the  English  ships,  which  come  out  to- 
gether, can  neither  of  them  take  a  return  cargo  of  such  articles  from  the  United 
States  to  London,  or  any  port,  on  account  of  the  high  duties.    But  the  British  ship 
can  take  the  same  articles  from  our  ports,  and  sail  to  the  nearest  British  colcmy, 
touch,  and  then  proceed  on  to  London,  or  any  port.     Her  voyage  is  now  from  the 
colony,  and  she  pays  only  the  colonial  duty  on  the  very  articles  she  took  from  our 
port.     Thus  she  sails  around  the  reciprocity  treaty.     The  American  vessel  is  not 
allowed  to  go  from  the  colony  to  England  ;  can  make  no  voyage ;  has  no  market ; 
and  is  left  in  our  docks.    The  British  vessel  soon  again  returns  with  another  cargo 
of  British  manufactures.    Thus,  in  the  circle  of  her  voyages  around  the  reciprocity 
treaty,  she  is  in  the  sole  possession  of  her  own  and  our  carrying  trade;  encouraging 
their  ship-building  and  shipping  interest,  and  employing  and  training  their  seamen 
and  vessels  in  the  very  trade  sacrificed  to  this  country  by  our  American  nego- 
tiators. 

"We  have  heard,  to  use  a  modern  and  homely  phrase,  of 'going  the  whole  hog.' 
But  what  farmer's  boy  ever  supposed,  because  he  had  bargained  for  the  old  sow, 
that  he  had  bought  the  whole  litter,  not  mentioned  in  his  agreement  ?     It  is  the 


462        THE  KFFKCTS  OF  A  PROTECTIVE  SYSTEM 

It  can  not  be  denied  that  the  account  given  in  the  extract  below 
is  enough,  and  it  would  hardly  be  believed  that  we  are   now  living 

taunt  of  Europe,  that  none  but  American  diplomatists  could  ever  have  supposed  a 
treaty  with  any  nation  embraced  their  colonies,  not  mentioned  in  it. 

"RECIPROCITY. 

"These  few  articles  will  serve  to  illustrate  the  whole:  — 

Dulles  From  U.  States.     From  British  Colonies. 

On  boards  or  other  limber,  per  load  of  50  cubic  feet $7  68 $0  48 

On  oars,  per  120 36  00 90 

On  handspikes,  per  140 9  60 24 

On  spokes  for  wheels,  per  1,000 19  20 48 

On  firewood,  per  load  of  216  cubic  feet 2  40 free. 

On  bacon,  112  lbs 175 84 

Beans,  bushel 2  26 75 

Beef,  bbl 3  58 87 

Butter,  112  lbs 5  00 1  12 

Cheese,     do 2  37 58 

Feathers,  do 5  00 2  25 

Flour,  bbl. 1  44 34 

Pork,  112  lbs 1  87 44 

Rice,  112  lbs 1  37 12 

Spirits  from  grain,  gallons 5  62 2  00 

Oil,  linseed,  tun 30  00 5  00 

Tallow,  1 12  lbs 79 06 

Wheat,  per  bushel,  on  a  sliding  scale,  prohibited  unless  almost  famine 06 

"  The  course  of  this  trade  is,  for  British  vessels  to  come  into  our  ports  and  take 
a  cargo  of  American  produce,  and  sail,  if  at  the  east,  for  Halifax  or  an  eastern 
province;  if  at  a  southern  port,  for  a  West  India  island;  and  having  touched  thus 
at  a  British  colony,  the  voyage  is  then  homeward  from  such  colony.  This  avoids 
the  reciprocity  treaty  —  secures  the  carrying  trade  of  our  grain,  timber,  &c.,  as  also 
the  benefit  of  the  discriminating  duties  in  favor  of  the  colonies. 

"The  extent  of  the  perversion  and  abuse,  under  the  reciprocity  treaties,  will  ap- 
pear in  part  from  a  recent  treasury  document,  statin?  '  the  Commerce  and  Naviga- 
tion of  the  United  States.'  It  states  the  '  clearances'  to  the  province  of  New  Bruns- 
wick to  be  :  154  American,  and  1,267  British  vessels  (for  nine  months),  from  1st  of 
October,  1842,  to  1st  of  June,  1843.  The  Americans  were  mostly  in  pursuit  of 
pJasler  for  the  New  England  states.  The  British  vessels  were  in  the  carryinsr  trade 
of  our  timber,  lumber,  and  fish,  and  to  tonch  only  at  New  Brunswick,  and  thence 
home,  payin?  only  their  colonial  duties  on  our  timber,  &c.,  and  which  is  prohibited 
to  American  vessels.     The  table  of  entrances'  will  illustrate  :  — 

American.  British. 

Passamaquoddy 63 431 

Portland 42 62 

Portsmouth 8 50 

Gloucester 2 31 

&c.,  &c.     These  facts  sufficiently  show  the  destructive  course  of  this  business. 

The  trade  on  our  lakes  is  equally  bad  :  — 

American.  British. 

Niasara 24 224 

G<-nesee 38 88 

Oswegatchie.   95 212 

&c.,  &,c. 


ox  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       463 

under  such  a  state  of  things,  or  that  it  has  existed  for  nearly  twenty 
years  without  redress.     It  is  further  stated  in  the  same  Magazine, 

"In  March,  1841,  I  came  up  the  Savannah  river,  and  there  saw  11  lar£;e  British 
vessels  loading  with  Georgia  timber — no  American  vessels  there!  This  course 
of  trade  is  not  allowed  to  an  American  vessel.  Reriprocity  in  British  trape,  means 
—  our  ports  open  to  her  commerce  —  her  ports  shut  to  our  commerce.  It  is  much 
better  for  her  than  Free  Trade.  In  that,  we  should  be  in  competition  with  her; 
in  the  reciprocity  trade,  we  are  shut  out. 

"  But  this  reciprocity  trade  is  not  restricted  to  our  country,  or  to  our  productions. 
The  treaty  extends  to  Brazil,  to  Hayti,  or  any  part  of  the  world  where  the  enter- 
prise and  the  voyage  of  an  American  vessel  can  be  defeated. 

"BRITISH  FREE  TRADE. 

"  '  Foreign  coffees  are  charged  Is.  3d.  per  pound  duty,  colonial  coffees  only  6d., 
while  coffees  imported  from  the  Cujie  of  Good  Hope  pay  9d.  Now,  as  the  cost  of 
sending,  in  an  unusual  and  indirect  way,  cotl'ees  from  a  foreign  country  to  the  Cape 
of  Good  Hope,  is  only  from  ^d.  to  \d.  per  pound ;  very  large  quantities  are  shipped 
from  Brazil  to  the  Cape,  and  thence  reshipped  to  England.' — Report  of  a  Commit- 
tee to  Parliament,  1840. 

"  '  Have  cargoes  of  coffee  been  sent  from  the  United  Kingdom,  and  from  ports  of 
the  continent  of  Europe,  to  be  landed  at  the  Cape  of  Good  Hope,  and  thence  to  be 
brought  back  to  the  United  Kingdom,  for  the  purpose  of  supplying  the  necessary 
consumption  here  ? 

"'Yes  :  from  26th  April,  1838,  to  24th  March,  1840,  it  appears  by  the  returns, 
that  81  cargoes,  importing  more  than  21,000,000  lbs.  of  foreign  coffee,  had  arrived 
in  the  United  Kingdom,  from  the  Cape  of  Good  Hope.  The  duty  on  that  mode  of 
carrying  coffee  is  9d.  per  pound.  If  entered  from  a  foreign  country,  Is.  3^.  The 
duty  saved  by  the  indirect  importation  would  be  750,000  pounds  sterling  (about 
$3,7.50,000).' — Examination  of  McGregor,  annexed  to  Report. 

"The  intent  and  meaning  of  this  is,  that  the  American  vessel  can  not  take  the 
coffees,  to  pay  Is.  and  3d.  sterling  per  pound  in  England.  She  is  not  allowed  to 
go  with  a  cargo  from  the  English  settlements  at  the  Cape  of  Good  Hope  to  an  Eng- 
lish port.  The  British  vessel  takes  the  coffee,  touches  at  the  Cape,  and  thence  her 
voyage  is  home,  where  she  pays  9d.  per  pound  duty  —  with  only  ^d.  or  ]d.  per  pound 
for  incieased  cost  of  her  indirect  way.  Should  the  American  vessel  take  a  cargo, 
and  conclude  to  bear  the  difference  of  duty,  the  English  vessel  would  soon  arrive, 
and  with  its  difference  of  duty  in  her  favor  (being  twelve  cents  per  pound)  would 
undersell  and  ruin  the  American  voyage.  Thus  the  American  shipowner,  with 
blighted  hopes,  learns  that  his  own  government  has  not  only  negotiated  him  out  of 
the  carrying  trade  of  his  own  country,  but  has  also  turned  him  out  of  the  carrying 
trade  between  all  other  nations  and  England.  It  is  apparent  that  the  English  gov- 
ernment negotiated  for  its  subjects;  but  it  is  very  difficult  to  say  for  whom  the 
American  government  negotiated. 

"  Our  neighbors,  the  Spaniards,  have  also  learned  something  of  this  mode  of  com- 
merce, and  of  the  kindness  of  our  government,  under  any  outrage,  in  its  commer- 
cial arrangements.  She,  too,  has  provided  a  duty  on  cotton,  so  high  as  to  prohibit 
its  importation  in  American  vessels;  while  it  is  brought  from  her  colonies  in  her 
own  vessels  at  a  nominal  duty.  Some  few  years  ago,  I  went  from  New  Orleans  to 
Havana,  in  an  American  vessel,  laden  in  part  with  cotton.  I  noticed  the  course  of 
the  trade.  On  arrival  at  Havana,  the  cotton  became  the  produce  of  Cuba,  and  was 
then  shipped,  as  such  (with  the  New  Orleans  bags  and  marks  upon  it),  in  a  Spanish 
vessel  for  old  Spain,  and  paying  only  the  colonial  duty. 

"  These  measures  show  the  devices  to  gain  our  trade,  to  exclude  American  ves- 


464  THE    EFFECTS    OF    A    PKjOTECTIVE    SYSTEM 

May,  ]^i6,  that  while,  in  1830,  the  year  of  the  ratification  of  this 
treaty,  American  bottoms  carried  exports  from  tliis  country  to 
Great  Britain,  to  the  value  of  $19,876,000,  and  British  bottoms  to 
the  value  of  $5,897,000,  the  British  carrying-trade  had  increased  in 
1844  to  $18,716,000,  against  $29,078,000  in  American  bottoms, 
shovvino-  an  increase  in  fifteen  years,  in  favor  of  British  bottoms, 
of  over  300  per  cent.,  against  an  increase  in  American  bottoms  of 
Jess  tlian  50  per  cent.  On  the  authority  of  the  secretary  of  state, 
house  document  No.  163,  second  session,  twenty-seventh  Congress, 
it  appears  that  the  result  of  our  treaty  of  1828  willi  the  Hanseaiic 
towns  is,  that  before  that  ireaty,  Jive  sevenths  of  the  vessels  entering 
those  ports  from  the  United  States  were  American  ;  and  that,  in 
184:0,  four  Jift.hs  were  Bremen,  and  only  one  fifth  American.      We 

sels,  to  injure  their  carrying  trade,  to  lessen  their  shipping  interest  and  ship-build- 
ing, to  depress  their  commerce  and  navigation,  and  all  in  violation  of  the  faith  of 
a  treaty  professing  to  be  reciprocal. 

"  Among  the  many  fruits  of  these  measures,  is  the  growing  increase,  within  the 
last  few  years,  of  foreign  tonnage  in  the  American  commerce.  The  entries  and 
clearances  (not  coasting)  at  some  of  our  ports  are  more  than  three  quarters  for- 
eign." Mr.  Webster,  as  above,  puts  one  third  of  our  foreign  trade  in  foreign  bot- 
toms. 

We  are  indebted  to  the  same  authority  as  above,  Mr.  Tallmadge,  for  the  follow- 
ing table,  which,  though  not  exactly  in  point  to  the  subject  of  this  chapter,  is  in- 
structive, and  worth  citing  :  — 

Total  export  of  articles,  tJxe  grou-th  or  produce  of  tlie  United  Stales,  to  England,  Scot- 
land, and  Ireland,  with  the  duties  paid  thereon,  during  the  years  1838,  1839,  1840. 

1838 Value.  .$50,481,624     Duties.  .$23,621,160 46  7-10  per  cent. 

1839 "     ..50,791,981  "     ..26,849,477 52  8-10  per  cent. 

1840   "      ..    54,005,790  "      ..    28,360,153 52  5-10  per  cent. 

Total...     "     ..155,279,395  "     ..   78,830,790    Av.  50  5-10  per  cent. 

Of  the  above,  the  value  of  cotton  and  tobacco,  and  the  duties  paid  thereon,  were 
as  follows :  — 

,„oo  ^  Cotton Value.  .$45,789,687     Duties.  .$2,761,612 


(  Tobacco 

1839  i  Cotton.. 
^^"^^  I  Tobacco 

iR4n^  Cotton.. 
^^^^  i  Tobacco 


. .     2,939,706 
..   46,074,579 
. .     3,523,225 
..   41,945,334 
. .     3,380,809 

(e 

. .  19,8(;0,898 
..    1,942.337 
..23,288,396 
..  3,247,880 
..22,537,205 

it 

..143,653,340 

..73,638,328 

Total 

All  articles  other  than  cotton  and  tobacco,  the  growth  or  produce  of  the  United 
States,  exported  to  England,  Scotland,  and  Ireland,  durins  the  same  three  years, 
amounted  to  $11,626,055,  or  $3,875,351  annually.  Omiltin?  cotton,  Great  Britain 
has  levied  an  average  duty  of  330  per  cent,  on  all  articles  the  growth  or  produce 
of  the  United  States. 

The  duty  on  raw  cotton  was  repealed  in  l84o,  and  other  duties  on  some  of  our 
exports  to  Great  Britain,  have  been  somewhat  modified  and  relaxed ;  but  not  enough 
essentially  to  vary  the  result,  as  above  stated. 


ON  THE  INTERESTS  OF  COMMERCE  AND  NAVIGATION.       465 

have  a  similar  arrangement  with  Sweden,  in  consequence  of  which, 
as  stated  by  the  same  document,  she  had  entered  on  our  China 
trade,  in  the  case  of  the  Swedish  ship  Albion,  and  was  hkely  to 
trespass  further  on  American  navigation.  Nothing  has  proved 
more  deceptive,  or  more  injurious  to  the  navigating  interests  and 
commerce  of  the  United  States,  than  these  commercial  treaties, 
professedly  based  on  principles  of  reciprocity  —  a  mock  reciprocity. 
The  great  commercial  nations,  such  as  England,  France,  Russia, 
Sweden,  Portugal,  Holland,  and  Belgium,  have  loaned  their  craft 
to  the  flags  of  the  small  states,  such  as  Denmark,  Hamburg,  Bre- 
men, Prussia,  Brazil,  Tuscany,  Rome,  and  Greece,  which  had 
nothing  to  lose,  and  everything  to  gain,  by  arrangements  of  this 
kind  with  the  United  States.  Thus  the  larger  commercial  powers 
have  stolen  the  benefit,  and  escaped  from  the  obligation  of  reci- 
procity. 

'I'he  importance  of  protecting  American  navigation  and  com- 
merce does  not  end  with  the  interests  of  the  parties  engaged  in 
these  pursuits,  nor  with  its  influence  on  the  general  wealth  of  the 
country.  The  commercial  marine  of  a  great  maritime  nation  is 
the  great  and  only  school  of  training  for  its  public  marine  —  for 
its  navy.  For  this  sole  purpose,  it  has  been  thought  best  to  enact 
bounties  for  our  fisheries,  which  are  still  continued.  Is  it  consist 
ent  to  tax  the  people  for  such  bounties  with  one  hand,  while  the 
other  is  stretched  forth,  in  the  form  of  commercial  and  reciprocity 
treaties,  not  only  to  rob  the  nation  of  ten,  or  fifty,  or  a  hundred 
times  of  the  same  kind  of  benefit  purchased  by  these  taxes  for 
bounties,  but  to  tax  the  people  indirectly,  by  robbing  them  of  a 
navigation  and  commerce  worth  millions  ?  That  item  of  six  mil- 
lions of  dollars'  worth  of  commerce  lost  to  our  navigation  by  British 
legislation  after  the  convention  of  London,  in  1S15,  can  not  have 
been  diminished,  but  must  have  greatly  augmented,  under  the  re- 
ciprocity treaty  of  1830.  But  setting  aside  these  interests  of  navi- 
gation and  commerce,  thus  sacrificed,  the  consequent  sacrifice  to 
the  public  marine  of  the  nation,  in  such  a  large  abridgment  of  the 
only  school  of  preparation,  is  no  trifling  consideration  as  it  relates 
to  public  economy.  In  whatever  point  of  view,  therefore,  these 
commercial  and  reciprocity  treaties  are  regarded,  and  in  all  their 
bearings  on  private  and  public  interests,  they  seem  to  have  nothing 
in  them  but  elements  of  great  injury  to  the  nation,  as  they  have 
hitherto  been  constructed. 

Foreign  commerce,  under  a  protective  system,  may  be  made  to 

30 


{/■ 


466  THE    EFFECTS    OF    A    TROTECTIVE    SYSTEM 

supply  all  the  wants  of  the  government,  in  a  time  of  peace,  without 
taxing  the  people.  That  it  may  be  made  to  supply  all  the  wants 
of  the  government,  in  a  time  of  peace,  is  proved  by  the  tariff  of 
1824,  1828,  1832,  and  1842  ;  and  that  it  will  not  tax  the  people, 
is  proved  from  the  fact,  already  established  in  this  work,  that  pro- 
/  tective  duties  are  not  only  not  taxes  at  home,  but  that  they  are  a 
rescue  from  an  enormous  system  of  foreign  taxation.  These  points 
being  established  —  as  they  are  beyond  controversy  —  it  is  clear 
that  a  protective  systen),  properly  adjusted,  without  imposing  du- 
<^'^' '  ties  on  foreign  articles  that  can  not  be  produced  at  home,  might  be 
^  (TtiJL-  r.  made  to  supply  all  the  wants  of  government,  in  a  time  of  peace  ; 
and  therefore  without  taxation,  since  protective  duties  are  not  taxes. 
Much  more  than  this  is  probably  true — though  it  can  not  be 
asserted  with  so  niuch  confidence  —  viz.,  that  a  protective  system, 
without  imposing  duties  on  articles  which  can  not  be  produced  at 
home  —  except,  perhaps,  some  luxuries,  and  other  articles  not  in- 
dispensable to  the  poorer  classes  —  might  be  so  adjusted  as  to  liqui- 
date a  very  heavy  national  debt,  in  addition  to  defraying  the  ordi- 
nary expenses  of  government  —  all,  of  course,  without  a  tax  upon 
the  masses,  since  protective  duties  are  not  taxes.  Such  are  the 
resources  of  the  country,  such  the  amount  of  its  home  products 
and  home  trade,  and  such  the  ingenuity,  skill,  industry,  enterprise, 
and  physical  ability,  of  the  people,  that,  under  an  adequate  system 
of  protection,  there  are  no  assignable  limits  to  the  possible  increase 
of  the  general  wealth,  or  to  the  ability  of  the  people  to  consume 
foreign  products,  subject  to  protective  duties.  Protect  the  people, 
let  them  grow  rich,  and  they  will  buy  largely  from  abroad,  to  raise 
an  indefinite  amount  of  revenue  —  enough,  probably,  to  meet  any 
future  contingent  wants  of  the  government,  even  though  a  war  debt 
should  be  run  up  to  one  or  two  hundred  millions — all,  of  course, 
for  the  reasons  before  stated,  without  a  tax  in  any  form,  direct  or 
indirect,  since  protective  duties  are  not  taxes. 


ON    THE    HOME    TRADE.  467 


CHAPTER   XXIX. 

THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM  ON   THE   HOME  TRADE. 

The  Home  Trade  the  Basis  of  the  Fortunes  of  the  Country  — "  Agriculture,  Manufactures, 
and  Commerce."  the  American  Coat  of  Arms — Home  Trade  has  always  made  the  For- 
tunes of  all  great  Continental  Nations — Insular  Nations  an  Exception. — The  Domestic 
Rp.sources  of  the  United  States  incalculable. — We  have  all  Climates  deemed  good,  and 
all  Physical  Elements  of  Wealth  — The  Country  and  the  People  fitted  for  each  other  — 
The  Country  a  World  in  It.'^elf — Care.  Work,  and  Frugality,  at  Home  the  same  for  a 
Nation  as  for  a  Private  Individual. — "  Far  Fetched,  dear  Bought." — Home  Trade  does 
not  diminish,  but  enlarges  the  Amount  of  Commerce,  as  ten  Miles  is  only  Half  of  Twenty, 
and  can  be  pone  over  twice  for  once  of  the  latter. — The  thriving  Man  works  on  his  own 
Estate. — Difference  in  Results  of  Trade  between  Parties  to  a  Nation  and  Nations  aa 
Parties. — The  comparative  Amount  of  Home  and  Foreign  Trade — Statistics. — Amount 
of  the  Products  of  Labor  in  the  Country. — Amount  of  Internal  and  Coasting  Trade. — 
Statistics. — Adam  Smith  on  Home  Trade. 

Our  home  trade  is,  and  must  for  ever  be,  the  basis  of  our  for- 
tunes. In  foreign  trade,  we  have  almost  always  been  losers,  and 
the  loss,  as  before  seen,  has  been  immense.  Individuals  have 
profited,  at  the  expense  of  the  public.  Hence  the  seductions  of 
foreign  traffic,  and  the  necessity  of  taking  care  of  it,  that  the  state 
receive  no  damage.  The  branches  of  foreign  commerce  are  like 
the  tenders  of  a  fleet,  the  scouting-parties  of  an  army,  the  roving 
agents  of  a  great  commercial  house.  If  licensed  with  privileges, 
care  should  be  taken  that  they  serve,  not  injure,  the  main  bodies. 
Every  merchant  in  the  foreign  trade  sails  under  the  flag  of  his 
country.  It  is  loaned  to  him,  protects  him,  secures  to  him  all  his 
benefits.  Besides  being  a  merchant,  wherever  he  goes  beyond  the 
bounds  of  his  country,  he  is  a  public  political  agent.* 

•  Mr.  Laing,  an  eminent  British  authority,  says  :  "  In  every  country,  the  home 
market  is  the  great  and  steady  basis  of  its  prosperity.  Commerce  itself,  if  it  be 
not  Ibunded  on  home  consumption  —  if  it  be  merely  a  carrying-trade  between  dis- 
tant producers  and  distant  consumers,  has  proved  itself,  as  in  the  Hanse-Towns, 
in  Genoa,  Venice,  and  Holland,  to  be  unstable,  evanescent,  and  unattended  with 
any  well-being  and  improvement  in  the  condition  of  the  mass  of  the  people.  The 
export  trade  is  but  the  overflowings  of  the  cup  of  our  industrial  production.  Its 
fulness  is  all  within  its  own  rim." 

The  "  Southern  Planter"  says  :  "  Commerce  has  as  deep  an  interest  in  securing 
the  home  market  and  supply  as  manufacturers  can  have.  Commerce  has  no  pa- 
triotism in  it,  when  based  upon  foreign  supplies.  All  its  profits  are  incidental, 
and  have  reference  to  its  basis  and  support.  Like  the  light  of  a  satellite,  the 
profits  of  commerce  are  borrowed  and  reflected,  not  inherent  as  the  centre  sun  of 
business  —  not  creative,  as  the  producers  are." 


4GS  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

Having  descended  from  a  great  commercial  nation,  the  people 
of  the  United  vStates  very  naturally  imbibed  the  spirit  of  their  an- 
cestry ;  and  being  favorably  situated  for  external  and  foreign  com- 
merce, it  has  always  been  one  of  their  favorite  and  great  pursuits. 
"  Ao'riculture,  manufactures,  and  commerce,"  have  ever  been  the 
three  comprehensive  words  which  represent  the  interests  of  this 
country.  It  is  too  late,  therefore,  to  raise  any  abstract  question 
about  the  utility  of  foreign  commerce,  although  much  might  be  said 
of  a  country  that  is  a  world  in  itself,  and  that  has  no  disjunct  and 
remote  dependencies,  in  favor  of  a  policy  chiefly  domestic.  In 
the  history  of  the  past,  it  will  be  found  that  nations  which  have 
flourished  the  longest,  and  attained  to  the  greatest  wealth  and  to 
the  most  impO'^'ing  grandeur,  eschewed  foreign  commerce,  and 
chiefly  devoted  themselves  to  domestic  arts  and  trade  ;  and  that  as 
soon  as  they  changed  this  policy,  tliey  began  to  decline,  steadily 
going  downward  as  they  multiplied  their  commercial  connexions 
abroad.  Cliina,  Hindostan,  and  ancient  Egypt,  are  of  this  class. 
The  exceptions  to  this  rule,  apparently,  are  cities  and  states  in  an 
insular  and  confined  condition,  as  Tyre,  Venice,  and  Great  Britain. 
There  would  at  least  seem  to  be  enough  in  history  and  reason  to 
show  that  t!ie  interest,  or  estate,  or  commonwealth,  which  is  not 
sound  and  strong  at  home,  will  only  be  weakened  and  dissolved 
the  sooner  by  stretching  out  its  arms  abroad.  Foreign  and  remote 
connexions  of  a  state,  either  commercial  or  political,  are  always  in- 
terests of  great  delicacy  and  precariousness  in  the  hands  of  states- 
men, and  require  consummate  wisdom  and  great  practical  tact  for 
a  care  and  management  which  shall  bring  profit  to  home  interests, 
and  equal  advantages  to  all  parties. 

It  can  not  but  be  seen,  from  the  ground  already  gone  over  in 
this  work,  that  the  United  States,  from  the  beginning  down  to  this 
time,  have  blundered  and  stumbled  along,  at  great  hazard  and  im- 
mense loss,  and  with  innumerable  bruises,  in  the  management  of 
our  foreign  policy  and  commerce.  And  what  is  our  foreign  com- 
merce worth,  as  compared  with  our  home  interest  and  trade?  — 
A  due  consideration  of  the  facts  to  be  presented  in  this  chapter, 
will  answer  this  question. 

The  resources  of  the  United  States  are  literally  beyond  estimate, 
speaking  only  of  what  they  are,  independent  of  the  capabilities  of 
the  people,  to  which  they  lie  in  abeyance,  and  by  which  they  have 
been  in  part,  and  are  to  be  more  fully,  developed.  There  is  no 
necessity  of  man  or  of  society  that  is  not  to  be  found,  or  which  can 


ON    THE    HOME    TRADE.  469 

not  be  produced,  here.  Tlie  United  States  and  territories  com- 
prehend the  finest  belt  of  tliis  western  continent,  stretching  from 
ocean  to  ocean,  and  from  the  icy  north  to  torrid  chmes.  The 
country  has  all  the  climates  that  could  be  desired  by  man,  and  is 
capable  of  all  productions  of  the  soil  necessary  to  man.  There  is 
scarcely  a  plant,  or  vegetable,  or  shrub,  or  tree,  on  the  habitable 
earth,  which  is  not  either  indigenous  or  capable  of  being  cultivated 
here.  It  is  not  within  the  memory  of  man,  nor  in  the  records  of 
known  history,  wlien,  if,  by  unpropitious  seasons,  there  was  a 
scarcity  of  the  necessaries  of  life  in  one  or  more  parts  of  this  wide 
domain,  there  was  not  a  plenty  in  others,  sufficient  for  all  demands. 
Nature,  in  this  field,  is  everywhere  bounteous  in  her  gifts,  and 
abundantly  rewards  the  labors  of  man.  Tlie  bordering  seas,  the 
lakes,  and  rivers,  teem  with  supplies  of  every  fish  known  to  the 
waters,  and  good  for  food.  As  the  forests  disappear  before  the 
advancing  strides  of  civilization,  the  mineral  world  unfolds  the 
exhaustless  wealth  of  its  bosom.  The  leaping  streams  and  plun- 
ging rivers,  found  in  every  quarter,  supply  a  power  of  motion  that 
could  never  be  used  up,  even  if  coal  and  steam  were  not  likely  to 
supersede  a  moiety  of  their  purposes.  The  great  natural  bosoms, 
arteries,  and  veins,  of  inland  trade,  aided  by  a  network  of  artificial 
communications,  easijy  cut  or  built,  have  brought  and  are  bringing 
the  remotest  parts  of  the  land  into  one  neighborhood.  The  soils 
are  indefinitely  capable  of  all  imaginable  productions,  and  the  founda- 
tions of  the  hills  and  mountains  are  not  laid  deeper  or  broader  than 
the  mines  of  wealth  which  they  contain.  Much  as  has  been  al- 
ready developed  of  the  resources  of  this  vast  field  of  nature,  by 
the  enterprise,  labor,  and  arts,  of  the  people,  in  the  brief  term  of 
their  history  as  a  nation,  and  much  as  has  been  realized  of  its  pro- 
lific and  deep  beds  of  wealth,  all  this  presents  only  the  superfices 
of  the  profound  and  exhaustless  treasures  that  lie  undiscovered  be- 
neath. The  United  States  and  territories  under  its  jurisdiction 
are  a  world  which  the  labor  and  industry  of  a  thousand  generations 
could  not  fully  explore,  or  begin  to  exhaust  of  its  capabilities  —  a 
world  that  challenges  cultivation  and  research,  with  a  promise  of 
reward  not  elsewhere  to  be  found  —  a  world  wiiich,  the  more  it  is 
used,  the  more  it  presents  that  is  profitable  for  use,  developing  new 
sources  of  wealth  with  every  stage  of  improvement.  In  a  word, 
there  is  nothing  wanting  here  to  make  those  now  tenants  of  these 
territories,  and  those  that  may  come  after  them,  independent  of  all 
the  Ivor  Id — nothing  but  the  purpose  to  make  it  so  ;  and  besides 


470  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

the  blessing  of  independence,  they  would  gain  more  wealth,  become 
more  happy,  and  be  vastly  more  powerful,  in  the  execution  of  that 
purpose,  than  by  roaming  abroad  to  get  what  costs  more  than  it 
comes  to,  and  what  hitherto  has  impeded  the  growth  of  this  coun- 
try more  than  all  other  causes,  and  neutralized  the  gains  of  domes- 
tic industry  and  home  labor. 

God  made  the  country,  and  God  made  the  people,  the  one  fitted 
to  the  other.  It  is  true  that  all  things  naturally  adapt  themselves 
to  the  influences  of  their  position,  and  it  matters  little  whether  the 
country  was  made  for  the  people,  or  the  people  for  the  country  ; 
or  whether  both  were  providentially  designed  for  each  other  ;  or 
whether  neither  of  these  propositions  were  exactly  true  when  con- 
sidered apart :  it  is  Providence  at  last  that  brings  about  these  mu- 
tual adaptations  where  the  two  are  brought  together.  It  is  true 
any  how  that  the  Anglo-Saxon  race  are  not  behind  any  other  race 
in  enterprise  and  in  all  the  capabilities  of  making  the  most  of  their 
circumstances,  and  in  putting  forward  society  and  civilization, 
wherever  they  are.  They  have  done  a  great  work  since  they  made 
a  home  on  this  continent,  and  the  only  obstacle  to  their  career  is 
a  looking  back  and  hankering  after  "  the  leeks  and  onions  of 
Egypt,"  and  holding  on  to  the  apron-strings  of  a  parent-race. 
This  country  has  come  to  be  a  world  in  itself;  and  if  all  the  rest 
of  the  world  were  sunk  to-day,  never  to  be  found,  we  might  feel 
the  want  of  tea  and  coffee,  and  a  few  foreign  luxuries,  for  a  season, 
till  substitutes  should  be  found,  or  the  same  things  be  produced 
among  ourselves;  but  the  skill,  science,  art,  industry,  labor,  enter- 
prise, civilization,  resources,  and  capabilities,  still  left  behind, 
would  amply  supply  the  loss,  and  it  would  scarcely  be  felt.  It 
would  be  far  better  than  a  system  of  Free  Trade,  as  the  world 
now  is,  holding  us  for  ever  in  bondage.  Let  this  country  be  put 
on  its  own  resources  and  capabilities,  and  it  would  rise  and  march, 
with  giant  strides,  to  its  own  proper  and  legitimate  destiny  of  un- 
exampled wealth,  greatness,  and  power.  It  requires  nothing  to 
accomplish  this  but  an  adequate  system  of  protection. 

Home  trade  is  always  best,  and  most  productive  of  wealth.  It 
is  no  matter  in  what  sphere  the  operation  of  this  principle  be  con- 
sidered, the  result  will  be  the  same.  It  will  behest  appreciated  by 
viewino-  it  on  a  small  scale.  Take  any  man,  of  any  calling,  in  his 
own  narrow  circle.  If  he  keeps  within  his  owmi  limits,  is  industri- 
ous and  frugal  (frugality  is  self-protection,  or  a  tariff  of  duties 
which  every  man  of  good  economy  imposes  on  himself  and  his 


ON    THE    HOME    TRADE.  471 

neighbors),  he  is  sure  to  prosper.  It  is  husbanding  his  own  affairs 
well  at  home,  that  makes  him  rich.  If  a  farmer  wants  any  addi- 
tion to  or  change  in  his  stock  ;  or  any  of  the  products  of  the  man- 
ufacturer or  the  mechanic  ;  or  groceries  or  cloths  of  a  tradesman  ; 
or  whatev^er  be  his  wants,  or  the  wants  of  any  other  member  of  the 
community,  no  such  person  makes  a  long  journey,  or  sends  an 
agent  abroad,  at  an  unnecessary  cost,  if  he  be  a  man  of  economy. 
But  he  accommodates  himself  as  near  home  as  possible.  Every 
one  finds,  by  experience,  that  a  home  trade  is  the  best  and  most 
profitable,  and  that  "  far-fetched"  is  always  "  dear  bought."  The 
economy  of  home  trade  is  all  comprehended  in  this  simple  view. 

Examples  of  this  kind  illustrate  all  others,  between  persons  of 
the  same  pursuits,  and  persons  of  different  pursuits,  running  through 
all  classes  of  society.  The  farmer  wants  the  mechanic's  products, 
and  the  mechanic  wants  the  farmer's  ;  the  tradesman  supplies  the 
people  in  his  neighborhood  with  articles  which  they  want,  and  can 
not  get  at  home,  and  takes  their  surplus  products  to  trade  in  where 
they  can  not  trade ;  and  both  parties  are  accommodated,  with  profit 
to  both.  The  nearer  home  a  trade  is  made,  is  both  private  and 
public  economy  ;  and  a  trade  made  at  home,  is  better  and  more 
economical,  than  that  made  anywhere  else.  Transportation,  and 
the  pay  of  intermediate  agents,  are  always  a  tax  and  a  loss,  which 
a  home  trade  saves  to  one  parly  or  the  other,  and  always  to  the 
public. 

If  it  be  said  that  these  intermediate  agents  need  employment,  it 
can  be  obtained  without  living  on  others  ;  and  the  principle  of  such 
a  reason,  carried  out,  as  will  be  seen,  is,  that  men  should  live  on 
each  other,  till  nothing  remains  among  them  all.  But  the  very 
object  of  giving  employment  to  these  agents,  and  multiplying  other 
employments,  is  best  secured  on  the  principle  of  protecting  and 
augmenting  home  trade  ;  for  that  is  the  best  way  to  extend,  enlarge, 
and  diversify  commerce.  It  is  not  proposed  by  advocating  home 
trade,  to  restrict  commerce.  On  the  contrary,  it  is  maintained, 
that,  by  keeping  things  well  at  home,  on  a  small  or  large  scale,  with 
individual  persons  or  communities,  is  the  safest  and  surest  way  to 
branch  out.  But  that  person  or  that  community  that  branches  out 
without  a  good  foundation  at  home,  will  be  likely  to  get  into 
trouble.  It  is  by  keeping  everything  tight  and  secure  at  home, 
that  the  extension  and  ramifications  of  trade  are  carried  on  with 
profit;  and  the  greatest  part  of  the  trade  of  society,  of  the  world,  is 
transacted  in  a  small  way,  and  in  very  limited  spheres.     It  is  these 


472  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

small  and  limited  operalions  of  commerce  which  sustain  large  and 
extended  transactions;  whereas  probably  not  a  thousandth  part  of 
the  minor  operations  ever  reach  the  larger,  though  they  always  con- 
stitute the  basis.  All  the  little  trade  of  society,  which,  after  all, 
makes  its  great  bulk,  is  noiseless,  everyday,  commonplace,  between 
neii'-hbors,  in  the  never-ceasing  exchanges  which  they  carry  on  with 
one  another,  for  mutual  advantage  and  profit.  The  thriving  man 
is  he  who  is  always  found  working  at  home,  and  the  nearer  his 
customers  are,  so  much  the  better  for  him  ;  and  the  nearer  he  is  to 
those  with  whom  he  trades,  so  much  the  better  for  them.  Their 
business  is  compact,  firm,  prosperous.  This  is  the  way  a  man,  a 
community,  a  nation  gets  rich  ;  and  being  rich,  becomes  a  belter 
customer,  the  man  to  his  neighbors,  the  community  to  adjoining 
communities,  and  the  nation  to  other  nations  ;  and  under  such  a 
system,  all  these  parties  are  mutual  helps  to  each  other.  It  is  be- 
cause there  is  a  home  foundation,  created  at  home,  to  trade  upon. 
Without  this,  they  could  not  trade  at  all,  honestly,  and  with  profit. 
It  is  not  good  economy  to  employ  intermediate  agents  in  trade,  for 
the  sake  of  employing  them.  In  that  way  men  become  a  burden 
to  each  other.  But  the  better  way  is,  to  work  and  thrive  at  home, 
and  thereby  create  occasions  for  a  trade  that  shall  set  these  agents 
in  motion,  and  make  them  necessary  ;  and  the  greater  the  home 
thrift,  so  much  more  numerous  and  extensive  will  be  the  ramifica- 
tions of  trade  which  it  calls  into  action,  beginning  at  home,  and 
branchino-  out  over  the  nation,  and  over  the  world. 

All  engaged  in  home  trade,  are  parties  to  the  nation  ;  but  in  the 
case  of  imports  and  exports,  the  nation  is  a  party.  It  must  be 
seen  that  a  home  trade  can  not  but  be  beneficial  to  the  nation  ;  and 
the  more  of  it,  the  better.  All  engaged  in  it  are  parlies  to  the 
same  commonwealth.  Some  lose,  and  some  gain  ;  but  the  com- 
monwealth is  always  a  gainer  in  domestic  trade.  In  the  commerce 
of  the  world,  the  world  is  the  commonwealth,  and  as  a  whole  is 
made  richer.  In  the  same  manner  as  individual  persons  are  parties 
to  the  nation,  in  a  home  trade,  nations  are  parties  to  the  world's 
commonwealth,  in  the  world's  trade;  and  in  the  same  manner  as 
some  of  the  parties  to  a  nation  become  rich,  and  others  poor,  in  a 
home  trade,  one  gaining  and  another  losing,  according  to  their  re- 
spective systems  of  private  economy,  so  in  the  world's  trade,  between 
nations  as  parties,  one  is  benefited  and  another  injured,  one  gains 
and  another  loses,  according  to  their  respective  systems  of  public 
economy.     In  all  foreign  commerce,  the  nation  is  a  party,  and  the 


^' 


ON    THE    HOME    TRADE.  473 

negotiator  the  agent.  If  all  the  agents  together  sell  more  than  they 
buy,  the  nation,  so  far  as  these  transactions  are  concerned,  is  a 
gainer,  and  adds  to  its  capital.  But  if  the  agents  buy  more  than 
they  sell,  the  nation,  on  the  same  conditions,  is  a  loser,  and  parts 
with  capital.  Although  these  two  propositions  are  incontrovertible, 
in  the  form  in  which  they  are  stated,  yet,  many  things  are  to  be 
considered,  to  determine,  whether,  in  the  case  of  the  first,  it  would 
not  have  been  still  better  for  the  nation,  if  a  part  of  this  trade  had 
been  done  at  home  ;  while  it  is  manifest,  in  the  case  of  the  second, 
that  it  would  have  been  better  for  the  nation,  if  so  much  of  this 
trade  had  been  done  at  home,  as  to  have  prevented  the  balance 
against  it.  In  order  to  determine  on  what  conditions,  in  the  case  of 
the  first  proposition,  it  would  have  been  better  for  the  nation, 
if  a  part  of  this  trade  had  been  done  at  home,  and  what  part  of  it, 
it  may  be  observed,  it  would  be  precisely  that  portion  of  the  im- 
ports which  could  have  been  produced  at  home,  under  a  system  of 
protection,  and  in  their  production  made  to  consume  what  was  sent 
abroad  to  buy  them.  In  that  case,  all  the  profits  of  these  transac- 
tions, in  consumption  of  raw  materials,  in  production,  and  in  the 
home  trade  concerned  in  it,  in  all  its  stages,  would  have  become  a 
part  of  the  permanent  capital  of  the  nation,  besides  the  additional 
employment  for  subsistence  which  it  would  have  given  to  the  par- 
ties engaged  in  it.  As  the  Southern  Planter,  cited  elsewhere, 
says,  "Figures  can't  calculate  the  difference.  It  outstrips  every- 
thing but  the  human  imagination"  in  its  results. 

This  position  of  a  nation,  as  a  party,  in  all  its  foreign  commerce, 
seems  to  have  been  entirely  overlooked  by  the  Free-Trade  econo- 
mists. Yet,  who  can  deny  that  it  is  so,  for  all  the  purposes  of  pub- 
lic economy  ?  We  do  not  say  that  the  nation,  as  such,  does  the 
business ;  nor,  that  the  agents  are  not  parties,  to  the  extent  of  their 
own  transactions,  as  much  and  as  truly  as  if  they  were  engaged  in 
the  home  trade.  But  we  do  say,  that,  for  all  purposes  of  public 
economy,  the  nation  is  not  only  a  party,  but  the  party,  when  the 
entire  amount  of  these  transactions  of  its  foreign  commerce  is  con- 
sidered ;  and  the  nation  may  be  a  loser,  when  the  merchants,  who 
have  occasioned  this  loss,  have  made  their  fortunes,  as  shown  in  a 
former  chapter.  Nor  can  the  nation  lose  without  dividing  the  loss 
among  the  people.  The  principle  that  the  nation  is  a  party  in  its 
forei""n  commerce,  considered  as  a  whole,  is  that  which  controls 
this  question,  and  determines  when,  and  how  far  it  has  need  of  a 
protective  system. 


474  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

As  remarked  in  the  opening  of  this  chapter,  the  branches  of  for- 
eign commerce  are  like  the  tenders  of  a  fleet,  the  scouting  parties 
of  an  arniy,  the  roving  agents  of  a  great  commercial  house.  They 
are  not  the  fleet,  nor  the  army,  nor  ti)e  trading  company.  They 
are  mere  sprigs  of  a  tree,  offslioots  of  a  trunk,  accidents  of  a  sys- 
tem ;  and  if  the  nation  be  a  great  and  powerful  one,  of  abundant 
territories  and  resources,  and  without  foreign  dependencies,  these 
sprigs  may  be  cut  off,  and  these  accidents  dropped,  without  any 
very  sensible  effect,  possibly  with  benefit  to  the  main  body.  This 
latter  contingency,  to  wit,  a  possible  benefit,  depends  on  others, 
which  it  is  unnecessary  here  to  consider,  inasmuch  as  it  is  not  pro- 
posed to  abandon  the  foreign  commerce  of  the  United  States,  and 
inasmuch  as  it  is  granted,  that,  under  proper  regulations,  it  may  be 
beneficial.  But,  it.  is  one  of  the  greatest  imaginable  mistakes,  to 
assume,  that  it  is  beneficial,  in  any  case,  and  without  a  well-con- 
sidered and  discreet  regulation.  A  world  of  facts  has  been  pre- 
sented, in  the  progress  of  this  work,  to  show,  and  which  conclu- 
sively prove,  that  the  foreign  commerce  of  this  country  has  hitherto, 
for  want  of  proper  regulation,  been  one  of  the  most  formidable 
obstacles  to  the  general  prosperity,  and  an  insuperable  impediment 
to  the  march  of  this  great  commonwealth  in  that  career  of  imj)rove- 
ment,  greatness,  and  power,  the  elements  of  which  have  been 
planted  in  its  bosom  by  Providence,  and  which  are  inherent  parts 
of  the  republic.  It  is  also  a  very  common  and  great  mistake  to 
put  our  foreign  commerce  before  our  home  trade,  in  the  estimate 
of  its  comparative  importance  ;  nor  is  it  less  common  to  overesti- 
mate its  comparative  amount. 

The  average  annual  aggregate  of  our  imports  and  exports,  in  a 
healthful  state  of  foreign  trade,  does  not  ordinarily  much  exceed 
two  hundred  millions  of  dollars,  or  one  hundred  millions  of  each. 
But  what  is  this,  compared  with  the  aggregate  amount  of  our  home 
trade?  It  is  a  very  inconsiderable  fraction,  as  the  facts  stated  in 
the  note  below  will  show.* 

*  By  the  "  statistics  of  products  and  condition  of  certain  branches  nf  industry 
of  Massachusetts,  for  the  year  endins;  April,  1845"'  —  official  documents  —  it  ap- 
pears, that  the  products  of  the  industry  and  labor  of  that  state,  for  the  nforesaid 
year,  amounted  to  $124,735,264;  that  the  capital  invested,  as  the  basis  of  this  pro- 
ducins;  power,  was  $59,145,767;  and  the  hands  or  persons  employed  in  these  pro- 
ductions, were  152,766.  The  avera<re  annual  export  of  the  products  of  the  United 
States,  of  all  kinds,  for  the  last  twenty  years,  has  been  about  $80,000,000.  It  ap- 
pears, therefore,  that  the  annual  product  of  the  industry  and  labor  of  the  single 
state  of  Massachusetts,  is  full  50  per  cent,  in  excess  of  all  the  exportsof  the  whole 
United  States. 


ON    THE    HOME    TRADE.  475 

Foreign  trade,  as  before  seen,  may  and  will  injure  the  country,  if 
not  carefully  guarded  by  a  protective  system.     Domestic  trade  can 

There  does  not  appear  to  be  an  agreement  among  our  statistical  autliorities,  as 
to  the  annual  product  of  the  industry  and  labor  of  the  United  States.  On  the  basis 
of  the  census  of  1840,  Professor  Tucker  rates  it  at  $1,045,134,736.  But  it  must 
be  seen,  by  the  above  official  statement  for  Massachusetts,  in  1845,  that  there  is 
probably  some  defect  in  Professor  Tucker's  statement,  which  is  partly  accounted 
for  in  his  classification,  embracing  only,  as  quoted  in  the  National  Magazine,  No- 
vember, 1846,  p.  561,  agriculture,  fisheries,  forests,  mines,  manufactures,  and 
commerce.  But,  in  senate  document,  340,  2d  session,  27th  Congress,  a  report 
from  the  committee  on  manufactures  of  that  body,  submitted  by  Mr.  Simmons,  it  is 
said  :  "  We  present  a  statement  of  the  amount  of  the  market  value  of  the  annual 
products  of  several  branches  of  industry,  as  exhibited  by  the  returns  of  the  last 
census  [1840]  :  The  value  of  the  annual  products  — 

Of  the  fisheries,  was $  15,204,142 

Of  the  forest 21,269,032 

Of  mines 48,658, 108 

Of  manufactures  and  mechanical  trades 457,875,238 

Of  agriculture 1,252,682,223 

1,795,688,743 
Omissions  estimated  at 204,311,257 

«  Total $2,000,000,000." 

This  statement  of  the  annual  product  of  the  labor,  industry,  and  arts  of  the  coun 
try,  is  probably  quite  as  large  as  facts  would  justify,  though  the  secretary  of  the 
treasury,  in  his  annual  report  for  December,  1847,  has  raised  it  to  $3,000,000,000. 
But  this  is  extravagant,  and  without  foundation,  like  many  other  things  in  tliat 
dreainy  and  unscrupulous  document,  the  errors  of  which  could  scarcely  be  told,  as 
repeatedly  demonstrated  on  the  floor  of  Congress,  without  disproof,  or  even  con- 
tradiction, on  the  part  of  the  secretary,  whose  position,  in  such  a  case,  demanded 
a  reply  and  vindication,  if  one  could  be  made. 

Among  the  many  proofs  brousht  forward  in  Congress,  of  the  errors  of  this  report, 
those  presented  in  the  speech  of  the  Hon.  Andrew  Stewart,  January  11,  1848,  and 
in  that  of  the  Hon.  John  A.  Rockwell,  March  1,  1848,  are  very  impressive,  not  to 
say  astounding  —  sufficient  to  discredit  the  document  entirely  as  a  reliable  source 
of  information,  not  simply  in  his  assumptions  in  defence  of  Free  Trade,  but  in 
matters  of  finance  indifl'erent  to  all  parties.  It  was  this  latter  class  of  errors  whrch 
brought  back  the  Hon.  Albert  Gallatin  from  flie  borders  of  tiie  grave,  to  show,  in 
his  pamphlet  on  the  subject,  how  glaring  and  alnrmin?  they  were. 

When  it  is  considered  what  a  variety  and  amount  of  the  products  of  the  country, 
and  how  many  classes  must  necessarily  escape  the  notice  of  the  official  asents  of 
government,  the  estimate  for  omissions,  in  the  senate  document  above  referred  to, 
may  be  resarded  as  moderate  ;  and  considerin?  the  authority  of  the  document,  as 
well  as  its  approximation  to  the  harmony  of  proportion,  when  compared  with  the 
official  report  of  Massachusetts  —  not  to  speak  of  the  growth  of  the  country  and 
the  increase  of  its  annual  products  since  1840  —  this  statement  may,  perhaps, 
safely  be  regarded  as  not  too  large.  We  may  receive  it,  then,  as  the  exponent  of 
the  present  annual  value  of  the  products  of  the  industry  and  labor  of  the  people 
of  the  United  Stales.  If,  then,  the  asgregate  annual  products  of  the  Union,  of  all 
kinds,  be  estimated  at  $2,000,000,000,  and  if  the  averase  annual  export  of  the 
same  be  $100,000,000,  it  will  be  seen,  that  only  about  (me  twentieth  of  the  entire 
product  leaves  the  country,  and  that  the  rest  is  consumed  or  used  at  home.     As 


476       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

never  injure,  is  always  beneficial.  The  more  of  it,  and  the  more 
active,  so  much  the  better.  Foreign  trade,  as  a  whole,  for  a  nation, 
is  always  a  delicate  operation,  and  for  the  benefit  of  any  country^ 
should  be  so  regulated,  as  not  to  import  more  than  is  exported, 
taking  all  that  goes  and  comes  into  consideration  ;  and  the  exports 
ou"-ht  to  be  something  in  excess.  Whether  they  can  be  too  much 
m  excess,  is  perhaps  a  question.  There  is  a  natural  limit.  In 
Great  Britain,  the  average  annual  balance  in  favor  of  home,  is  usu- 
ally some  tens  of  millions  of  dollars.  This  does  not  all  appear 
from  the  usual  display  of  her  exports  and  imports.  It  comes  in 
other  ways;  and  if  it  comes,  it  is  no  matter  how.  Great  Britain  is 
the  great  capitalist  of  the  world  —  owes  nobody  but  herself,  and 
everybody  owes  her,  and  must  at  least  pay  interest,  as  we  do  — 
except  what  we  rejmdinte.  vShame  on  this  delinquency!  It  is  the 
subsidies  of  Great  Britain,  and  her  compensations,  extorted  from 
vanquished  nations,  which  constitute  one  great  item  of  her  income. 
For  the  last  fifty  years  she  has  been  perpetually  draining  the  here- 
tofore richest  portion  of  the  world  —  the  East — where  gold  was 
piled  up  in  heaps,  and  silver  was  as  stones.  Was  not  China  beaten, 
and  forced  to  pay?  —  the  Seikhs,  and  forced  to  pay  ?  The  national 
debt  of  Great  Britain,  all  owned  at  home,  is  no  otherwise  a  diffi- 
culty with  the  government,  than  the  financial  task  of  raising  more 
money  to  pay  interest.  The  nation,  as  a  whole,  is  no  poorer  on 
that  account.     In  the  United  Stales,  under  the  tariff  of  1842,  the 

there  are  no  certain  data  by  which  to  determine  what  portion  of  this  is  the  subject 
of  home  trade,  it  may,  perhaps,  be  safely  put  at  $1,000,000,000,  less  or  more.  The 
amount,  then  —  allowin?  $200,000,000  for  imports  and  exports  —  is  ten  to  one  of 
that  which  is  the  subject  of  foreign  trade.  Its  comparative  importance,  however, 
is  indefinitely,  but  vastly  greater,  than  would  be  represented  by  this  difference. 
That  which  is  exported,  is  the  subject  of  one  commercial  transaction,  but  ever 
after  dead  to  the  country  :  wliereas,  a  large  portion  of  that  which  remains,  enters 
into  the  substantial  capital  of  the  country,  and  becomes  reproductive,  in  endless 
progression,  and  by  a  ratio  not  exceeded  by  the  geometrical. 

The  same  is  true  of  other  countries.  The  internal  industry  of  France,  for  1842, 
was  estimated  at  8,000,000,000  francs,  and  her  exports  at  1,065,400,000  —  the  ex- 
ports being  less  than  one  eighth  of  the  productive  industry  of  the  country.  And  in 
relation  to  Great  Britain,  the  great  commercial  nation  of  the  world,  whose  manu- 
factures have  been  nurtured  for  centuries,  and  whose  commercial  marine  is  by  far 
the  greatest  of  all  other  nations,  the  Hon.  Edward  Everett,  while  our  minister  at 
the  court  of  London,  stated,  at  an  as;ricultural  meeting  in  Derby,  England,  in  1843, 
Earl  Spencer  in  the  chair,  that,  although  the  commerce  between  Great  Britain  and 
the  United  States  was  twice  as  great  as  between  England  and  any  other  country, 
yet  the  whole  of  the  products  passing  to  and  fro,  was  not  worth  so  much  as  the 
oats  and  beans  raised  in  Great  Britain,  as  proved  by  their  own  asricultural  statis- 
tics; and  that  the  entire  value  of  the  products  employing  British  navigation,  all 
the  world  over,  was  not  equal  to  that  of  the  grass  grown  in  Great  Britain. 


ON    THE    HOME     TRADE.  477 

balance  in  our  favor  had  got  to  be  some  six  or  seven  millions  aver- 
age— just  enough  to  save  us  from  commercial  bankruptcy  in  for- 
eign trade.  But  in  domestic  trade,  there  is  no  such  delicacy  —  no 
such  danger.  The  more  work  there  is  done  on  an  estate,  the  bet- 
ter ;  and  the  United  States  Is  only  a  large  freehold. 

The  coasting  trade,  as  appears  from  official  documents,  employs 
about  half  the  tonnage  of  the  country.  And  when  the  short  and 
frequent  voyages  of  this  part  of  our  commercial  craft  are  consid- 
ered, as  compared  with  the  part  engaged  in  foreign  commerce,  the 
business  It  does  in  the  home  trade  must  be  many  times  greater  than 
the  foreign.* 

o 

*  From  the  official  records  of  Massacliusetts,  it  appears,  as  stated  by  Mr.  Hud- 
son, in  his  speech  in  Congress,  June  29,  1846,  that — 

"  The  number  of  vessels  which  entered  the  port  of  Boston  alone,  in  1845, 
from  other  ports  of  the  United  States,  beyond  tlie  bounds  of  Massachusetts  —  not 
counlins:  fishing-craft,  nor  the  wood,  lumber,  and  hay  coasters,  from  Maine  —  was 
5,481,  with  an  aggregate  of  900,620  tons,  or  nine  tenths  of  all  the  registered  ton- 
nage of  the  country.  Of  these,  170  were  from  New  Orleans,  39  from  Mobile,  and 
35  from  Florida  —  making  244  from  the  gulf  of  Mexico.  These  244  vessels,  with  a 
register  of  1 18,600  tons,  brousht  into  the  city  of  Boston,  from  the  quarters  mentioned, 
cotton,  flour,  corn,  hemp,  hides,  feathers,  lead,  beef,  pork,  ham,  lard,  sugar,  mo- 
lasses, staves,  tallow,  wood,  and  tobacco,  to  the  amount  of  $9,500,000  —  not  to 
speak  of  grass-seed,  castor-oil,  linseed-nil,  beeswax,  furs,  peltry,  beans,  peas, wheat, 
corn-meal,  whiskey,  bufi'alo-robes,  copper,  iron,  leather,  butter,  and  a  ereat  vari- 
ety of  other  articles  of  domestic  arowlh,  amounting  to  millions.  This  includes 
only  the  freight  from  the  gulf  to  Boston.  If  we  add  the  freight  from  Bos- 
ton to  the  gulf,  and  all  the  foreign  products  which  were  transported  both  ways, 
which  are  not  included  in  the  above  estimate,  it  would  amount  to  more  than  one 
fourth  of  our  whole  export  to  all  foreign  parts.  The  internal  trade  which  comes 
to  the  Atlantic  through  the  Hudson  river,  i?  equal  to  nearly  half  of  our 
foreign  commerce.  The  freight  brousht  to  the  Hudson,  in  1845,  by  the  Erie  and 
Champlain  canals,  was  valued  at  $45,454,000,  sind  the  amount  which  entered 
these  canals,  at  Albany  and  Troy,  amounted  to  $55,454,000  —  showing  a  total  of 
$100,908,000,  being  more  than  all  exports  to  foreign  nations,  for  the  same  year,  of 
the  growth  or  produce  of  the  United  States.  The  transportation  on  the  New  York 
canals,  in  1845,  was  1,977,565  tons,  being  but  3  per  cent,  less  than  the  whole 
amount  of  American  tonnage  which  entered  our  ports  the  same  year,  from  all  for- 
eign ports." 

The  following  extract  from  an  article  in  Fisher's  National  Magazine,  September, 
1846,  by  Lot  Clark,  Esq.,  of  Lockport,  on  the  New  York  canals,  is  pertinent  here  : — 

"  The  tons  of  products  and  merchandise  moved  on  the  canals  the  past  year,  were 
1,977,565;  the  total  tonnage  clearing  from  all  the  portsof  the  United  States,  coast- 
ers and  all,  in  the  year  1844,  as  appears  from  the  report  of  the  secretary  of  the 
treasury,  was  2,010,924  tons;  the  difference  only  43,359  tons.  The  tonnage  en- 
tering all  the  ports  of  the  United  States,  was  1,977,438  tons,  being  twenty-sevea 
tons  less  than  the  tons  of  movement  on  the  canals.  If  we  compare  values,  the  con- 
trast is  not  less  striking.  The  value  of  all  the  products  and  merchandise  carried 
on  the  canals  the  year  past,  as  appears  from  the  trade  and  tonnage  report  of  the 
commissioners  of  the  canal  fund,  was  $100,629,859;  the  whole  amount  of  all  the 
exports  of  products  and  merchandise  from  the  United  States,  as  appears  by  the  sec- 


478  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

To  have  a  just  idea  of  the  short-route  trade,  constantly  going  on, 
one  has  only  to  observe  the  active  movement  of  the  people  through- 
out the  country,  on  errands  of  business.  Nearly  all  this  activity  is 
trade.  Bargains,  or  exchanges,  all  which  are  trade,  are  constantly 
going  on  between  neighbors,  for  reciprocal  benefit.  It  is  stated  in 
the  National  Magazine,  that  "on  the  Erie  canal,  for  a  number  of 
years  after  it  was  finished,  for  the  whole  distance  between  Albany 
and  Buffalo,  the  amount  of  merchandise  carried  ihrovgfi,  was  only 
about  2i  per  cent,  of  the  whole  ;  that  about  Hths  of  the  receipts 
were  for  goods  or  persons  going  but  a  portion  of  the  distance,  and 

retary's  report  for  the  year  1844,  was  $99,715,179;  difference  in  favor  of  canal 
commeirce,  $914,680.  Aijain,  if  we  compare  the  tons  moved  on  the  canals  with 
the  tonnage  entering  and  ariivins  at  the  port  of  New  York,  from  and  to  all 
parts,  we  find  how  much  greater  is  the  canal  navigation  :  In  1844,  the  tonnage 
cleared  from  New  York,  foreign  and  domestic,  was  498,254  tons;  and  of  all  that 
entered  that  port  was  576,480  tons;  total,  1,074,734  tons;  being  in  all,  902,831 
tons  less  than  was  carried  on  the  canals.  Again,  the  total  value  of  all  the  ex- 
ports from  the  city  of  New  York,  clearing  from  that  port  in  1844,  to  all  places, 
was  $32,891,540,  while  the  value  of  the  products  carried  to  the  tidewater  on  the 
canals  the  past  year,  was  $45,452,321  ;  ?o  that  whatever  comparison  you  institute, 
you  find  that  this  internal  navigation  is  by  far  the  greatest  interest  of  the  state." 

It  appears  by  Executive  Doc,  No.  19,  30th  Congress,  that  the  enrolled  and 
licensed  tonnage  of  the  lakes,  for  1841,  was  56,252  tons;  for  1846,  106,836  tons; 
and  that  the  money  value  of  the  lake  commerce,  for  1841,  imports  and  exports,  was 
$65,826,022,  and  for  1846,  $123,829,821;  being  an  annual  average  increase  of 
17  98-100  per  cent.  The  total  amount  of  merchandise,  in  tons,  for  1841,  was 
2,071,802,  and  for  1846,  3,861,088  tons;  being  an  annual  average  increase  of  17 
27-100  per  cent.  The  Briiish  tonnage  on  the  lakes  is  about  half  that  of  the  Ameri- 
can. To  the  above  should  be  added  the  passenger  trade,  which  Mr.  Barton,  of 
Buffalo,  say^,  was  not  less  than  250,000  persons,  to  and  fro,  in  1846,  amounting, 
at  $5  for  each  passenger,  to  $1,250,000.  The  lake  commerce,  increasing  for  ten 
years  subsequent  to  1846,  as  for  five  years  preceding,  at  17  per  cent.,  will  amount, 
in  1857,  to  upward  of  $170,000,000,  net,  or  to  $340,000,000  for  imports  and  ex- 
ports. It  should  be  observed,  that  sixteen  of  the  lake  ports  are  not  included  in 
the  estimates  for  the  above  results,  not  being  known. 

By  the  same  document  as  above,  it  appears,  that  the  steamboat  tonnage  for  the 
Mississippi  and  its  tributaries,  for  1842,  was  126.278  tons;  and  for  1846,  249,055 
tons.  A  Cincinnati  memorial  to  Congress,  of  1842,  supposes  there  are  4,000  boats 
of  other  kinds  (not  steamboats)  on  these  waters,  with  an  average  of  75  tons  each, 
amounting  to  300,000  tons.  These  are  the  flat-boat  craft,  which  do  not  return; 
but  it  is  supposed  that  two  series  of  these  boats  are  used  in  a  year,  raising  their 
tonnage  to  600.000,  as  stated  by  the  document  before  us.  The  average  of  the 
Steamboat  running  is  put  down  at  ten  trips  a  year,  which  makes  their  joint  freights 
1,262,780  tons;  which,  added  to  the  above  600,000  tons  by  other  kinds  of  boats, 
amounts  to  1,862,780  tons  for  1842.  The  yearly  expense  of  this  craft,  building 
and  repairing,  is  stated,  for  1846,  at  upward  of  $20,000,000.  The  average  annual 
increase  of  tonnage  on  these  waters,  from  1842  to  1846,  was  24  3-10  per  cent. 
The  net  money  value  of  this  trade,  for  1846,  through,  way,  passenger,  and  all,  is 
stated  at  $183,609,725;  or  exports  and  imports  between  places,  $367,219,450. 
The  latter  is  the  true  expression  of  the  movement. 


ON    THE    HOME    TRADE.  479 

either  received  or  discharged  at  intermediate  points  hetween  Alba- 
ny and  Buffalo ;  and  that,  although  there  is  a  new  world  open  at 
the  west  since  that  time,  and  the  amount  of  intercourse  and  busi- 
uess  has  become  immense  with  the  seaboard,  yet,  it  is  true  at  this 
moment,  that  the  local  business  is  still  superior  to  the  through  busi- 
ness on  that  canal."  The  same,  or  like,  is  alleged  of  the  passenger 
U'ade  on  the  Hudson.  From  every  point  of  the  United  States, 
where  there  are  people,  more  start  on  business  for  five  miles  than 
for  ten  ;  more  for  ten  than  for  twenty  ;  more  for  twenty  than  fifty  ; 
and  so  on.  This  shows,  that  the  great  amount  of  home  trade  is 
Imperceptible  and  incalculable. 

It  can  not  but  be  seen,  that  this  internal  and  coasting  trade — of 
which  the  facts  cited  in  the  note  are  only  very  limited  and  restricted 
examples  —  running  on  lines  which  cross  each  other  at  all  points, 
making  a  complete  network  of  the  whole  land,  to  facilitate  exchan- 
ges, must  be  vastly  comprehensive,  and  not  less  important.* 

•It  will  be  observed,  that  we  have  said  little  of  our  ^ea-coastin?  trade,  except 
m  the  case  of  Massachusetts.  We  have  not  the  sources  of  information  at  hand. 
But  it  is  a  great  trade  —  many  times  to  one  of  all  our  foreign  commerce,  as  evinced 
by  the  daily  arrivals  and  departures  of  coasting  craft  in  our  ports.  They  come 
and  go  in  clouds. 

Adam  Smith  has  well  said  on  this  subject :  "An  inland  country,  naturally  fer- 
tile and  easily  cultivated,  produces  a  great  surplus  of  provisions  beyond  what  is 
necessary  to  maintain  the  cultivators.  Abundance  renders  provisions  clieap,  and 
encourases  a  great  number  of  workmen  [artisans]  to  settle  in  the  neighborhood, 
who  find  that  their  industry  can  there  procure  them  more  of  the  necessaries  and 
conveniences  of  life  than  in  other  places.  They  work  up  the  materials  of  manu- 
facture which  the  land  produces,  and  exchange  their  finished  work,  or  what  is  the 
same  thin?,  the  price  of  it,  for  more  materials  and  provisions.  They  give  a  new 
value  to  the  surplus  part  of  the  rude  produce,  by  saving  the  expense  of  carrying  it 
to  the  water  side,  or  to  some  distant  market;  and  they  furnish  the  cultivators  with 
something  in  exchange  for  it,  that  is  either  useful  or  agreeable  to  them,  upon  easier 
terms  than  they  could  have  obtained  before.  The  cultivators  get  a  better  price  for 
their  surplus  produce,  and  can  purchase  cheaper  other  conveniences  which  they 
have  occasion  for.  They  are  thus  both  encouraged  and  enabled  to  increase  this 
surplus  produce,  by  a  better  improvement  and  better  cultivation  of  the  land;  and 
as  the  fertility  of  the  land  had  given  birth  to  the  manufacture,  so  the  progress  of 
the  manufacture  reacts  upon  the  land,  and  increases  still  further  its  fertility.  The 
manufacturers  first  supply  the  neighborhood,  and  afterward,  as  their  work  im- 
proves and  refines,  more  distant  markets."  In  this  way  he  goes  on  to  account  for 
the  growth  of  all  the  manufacturing  towns  of  England.  Is  not  this  remarkable 
doctrine  for  one  who  is  relied  upon  for  a  system  of  economy  directly  the  opposite 
of  this? 

But  again  he  says  :  "The  inland,  or  home  trade,  the  most  important  of  all  — 
the  trade  in  which  an  equal  capital  affords  the  greatest  revenue,  and  creates  the 
greatest  employment  to  the  people  of  the  country,"  5tc.  —  "A  capital  employed  in 
the  home  trade,  will  sometimes  make  twelve  operations,  before  a  capital  employed 
in  the  foreign  trade  has  made  one.     If  the  capitals  are  equal,  therefore,  the  one 


480       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

The  Hon.  Abbott  Lawrence,  in  a  letter  to  the  Hon.  William  C 
Rives,  of  Virginia,  dated  Boston,  January  16,  1846,  says:  "We 
[of  Massachusetts],  previous  to  the  war  of  1812,  were  an  agricul- 
tural and  navigating  people.  The  American  system  [the  protective 
policy]  was  forced  upon  us,  and  was  adopted  for  the  purpose  of 
creating  a  home  market  for  the  products  of  the  soil  of  the  south 
and  west.  We  resisted  the  adoption  of  a  system,  which,  we  hon- 
estly believed,  would  greatly  injure  our  navigation,  and  drive  us 
from  our  accustomed  employments,  into  a  business  we  did  not  un- 
derstand. We  came  into  it,  however,  reluctantly,  and  soon  learned, 
that,  with  the  transfer  of  our  capital,  we  acquired  skill  and  knowl- 
edge in  the  use  of  it ;  and  that,  w  far  from,  our  foreign  commerce 
being  diminished,  it  was  increased;  and  that  our  domestic  tonnage 
and  commerce  were  very  soon  more  than  quadrupled." 

will  give  four-and -twenty  times  more  encouragement  and  support  to  the  industry 
of  the  country  than  the  other." 

And  yet  again  :  "  The  greatest  and  most  important  branch  of  the  commerce  of 
every  nation,  it  has  already  been  observed  [this  is  a  great  point  in  his  work],  is 
that  which  is  carried  on  between  the  inhabitants  of  the  town  and  those  of  the 
country.  The  inhabitants  of  the  town  draw  from  the  country  the  rude  produce 
which  constitutes  both  the  materials  of  their  work  and  the  fund  of  their  subsist- 
ence; and  they  pay  for  this  produce  by  sending  back  to  the  country  a  certain  por- 
tion of  it  manufactured  and  prepared  for  immediate  use.  The  trade  which  is  car- 
ried on  between  these  two  sets  of  people,  consists  ultimately  in  a  certain  quantity 
of  rude  produce  exchanged  for  a  certain  quantity  of  manufactured  pioduce.  .  . 
Whatever  tends  to  diminish,  in  any  country,  the  nmnber  of  artificers  and  ma.nvfac- 
turers,  tends  to  diminish  the  home  market,  the  most  important  of  all 
MARKETS,  for  the  rude  produce  of  the  land,  and  thereby  still  further  to  discourage 
agriculture.  Those  systems,  therefore,  which,  preferring  agriculture  to  all  other 
employments,  in  order  to  promote  it,  impose  restraints  upon  manufactures,  and  for- 
eign trade,  act  contrary  to  the  very  end  which  they  propose,  and  indirectly  discour- 
age that  very  species  of  industry  which  they  mean  to  produce." 

This,  as  can  not  be  denied,  is  pretty  strong  and  decided.  It  is  always  safe  to 
leave  the  argument  for  Protection  in  Adam  Smith's  hands,  when  he  is  going  on  in 
his  natural  way.  He  can  not  help  speaking  the  truth,  and  the  wliole  truth; 
though  he  does  not  seem  to  have  felt  himself  in  court,  and  under  oath,  to  speak 
nothing  but  the  truth.  He  had  masters  to  serve,  who  fed  and  clothed  him,  as 
shown  in  another  chapter,  and  for  their  great  political  designs,  he  was  occasion- 
ally compelled,  as  may  be  believed,  to  violate  his  conscience,  not  less  than  his  prin- 
ciples. 


ON    THE    COTTON-GROWING    INTEREST.  481 


CHAPTER    XXX. 

THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM    ON    THE    COTTON- 
GROWING    INTEREST. 

The  Reasoning  of  a  Secretary  of  the  Treasury,  on  the  Cotton-Growing-  Interest,  consid- 
ered— The  Impoitance  of  tliio  Interest  hm  compared  witii  otliers — The  "Forty-Bale 
Theory  " — A  Variety  of  instructive  Statistics  on  ll^e  Cotton  and  other  Interests  of  the 
Country. — The  Cliiims  of  the  Cotton  Interest,  as  being  one  of  (-uperior  Political  inipor- 
taiice,  examined. — The  Profits  of  Cotton  Growers  and  Manufacturers  compared — The 
Eviilence  of  Mr.  Clay  and  the  '•  Southern  Planter"  on  this  Point. — Table  of  Prices  of 
Cotton  from  1790  to  1844 — A  Protective  System  more  important  to  the  Cutton-tirowing 
Intere.-it  than  to  any  other. — A  rennirkable  and  decisive  Mode  of  Proof — Action  of  a 
Convention  of  Mi.ssissippi  Cotton  Planters  on  the  Subject 

The  secretary  of  the  treasury,  in  his  annual  report  of  Decem- 
ber, 1845,  said,  "The  cotton-pinnting  interest  suffers  from  the 
tariff  [ol  1842]  in  the  double  capacity  of  consumer  and  exporter^ 
This  theory  will  be  easily  apprehended  by  a  perusal  of  the  follow- 
ing extracts  from  a  speech  of  Mr.  Clay,  in  the  senate,  February, 
1832:— 

"It  is  alleged  that  the  import  duty  is  equivalent  to  an  export 
duty,  and  falls  on  cotton,  'i'he  framers  of  our  constitution,  by 
granting  the  power  to  Congress  to  lay  imposts,  and  prohibiting  that 
of  laying  an  export  duty,  ntanifested  that  they  did  not  regard  them 
as  equivalent.  Nor  does  the  common  sense  of  mankind.  An  ex- 
port duty  fastens  upon,  and  incorporates  itself  with,  the  article  on 
which  it  is  laid.  But  an  import  duty  on  a  foreign  article  leaves 
the  exporter  of  the  domestic  article  free  —  first,  to  import  specie; 
secondly,  goods  which  are  free  from  the  protecting  duty  ;  or  thirdly, 
such  goods  as,  being  chargeable  with  the  protecting  duty,  he  can 
sell  at  home." 

Again  :  "  The  case  has  been  put  in  debate,  and  again  and  again 
in  conversation,  of  the  South-Carolina  planter,  who  exports  one 
hundred  bales  of  cotton  to  Liverpool,  exchanges  them  for  one  hun- 
dred b;des  of  merchandise,  and  when  he  brings  them  home,  being 
compelled  to  leave  at  the  customhouse  forty  bales  in  the  form  of 
duties.  The  arrangement  is  founded  on  the  assumption  that  a  duty 
of  40  per  centum  amounts  to  a  stibfraction  of  forty  from  the  one 
hundred  bales  of  merchandise.  The  first  answer  to  it  is,  that  it. 
supposes  a  case  of  barter,  which  never  occurs.     If  it  be  replied^ 

31 


482  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

that  it  nevertheless  occurs  in  the  operations  of  commerce,  the  an- 
swer would  be,  that,  since  the  export  of  Carolina  cotton  is  chiefly 
made  by  New  York  or  foreign  merchants,  the  loss  stated,  if  it  re- 
ally occurred,  would  fall  upon  them,  and  not  upon  the  planters. 

"  But,  to  test  the  correctness  of  the  hypothetical  case,  let  U3 
suppose  that  the  duty,  instead  of  40  per  centum,  should  be  150, 
which  is  asserted  to  be  the  duty  in  some  cases.  Then,  the  planter 
would  not  only  lose  the  whole  hundred  bales  of  merchandise,  which 
he  had  gotten  for  his  hundred  bales  of  cotton,  but  he  would  have 
to  purchase,  with  other  means,  an  additional  fifty  bales,  in  order  to 
enable  him  to  pay  the  duty  accruing  on  the  proceeds  of  the  cotton  ! 
Another  answer  is,  that  if  the  producer  of  cotton  in  America  ex- 
changed against  English  fabrics,  pays  the  duty,  the  producer  of 
the  fabrics  also  pays  it,  and  then  it  is  twice  paid.  Such  must  be 
the  consequence,  unless  the  principle  is  true  on  one  side  of  the 
Atlantic,  and  false  on  the  other.  The  true  answer  is,  that  the  ex- 
porter of  an  article,  if  he  invests  his  proceeds  in  a  foreign  market, 
takes  care  to  make  the  investment  in  such  merchandise  as,  when 
brought  home,  he  can  sell  with  a  fair  profit." 

When  a  doctrine  or  theory  —  for  this  is  nothing  but  a  theory  — 
is  proved  absvrd,  as  above,  that  is  enough.  No  reasoning  can 
stand  before  a  plain,  palpable  absurdity,  like  this.  The  cotton- 
planter  usually  sells  his  cotton,  out  and  out,  to  a  New-York  broker, 
or  to  a  merchant  somewhere,  at  the  market  price,  j)uts  the  money 
in  his  pocket,  and  there  it,  is.  But  this  theory  supposes  it  is  not 
there.  Or,  that,  by  some  unaccountable  process,  40  per  cent,  of 
it  is  afterward  abstracted.  If  the  planter,  having  the  money  for 
his  cotton  once  in  his  own  desk,  lets  a  part  of  it  go,  it  must  be  his 
own  fault.  There  is  no  such  thing  as  barter  in  these  transactions. 
The  exporter  of  cotton  pays  the  cotton-grower  cash,  and  if  he 
imports  merchandise  with  its  proceeds,  instead  of  cash,  it  is  be- 
cause he  expects  more  cash  in  the  end,  by  profits  on  his  imports, 
duties  or  no  duties. 

But  admitting  the  truth  and  validity  of  the  "  forty-bale  theory," 
or  of  what  the  secretary  of  the  treasury  calls  "cotton  suffering  in 
the  double  capacity  of  consumer  and  exporter"  —  it  would  be  hard 
to  believe  it  —  but  admitting  it,  it  has  been  demonstrated  in  another 
part  of  this  work  that  protective  duties  in  this  country"  are  not  taxes, 
in  the  operation  of  the  system,  to  any  party  or  person  ;  that  pro- 
jected articles  of  manufacture  are  generally  clieaper — in  the  ag- 
gregate always  cheaper  ;   and  that  the  system  relieves  the  people 


ON    THE    COTTON-GROWING    INTEREST.  483 

from  a  heavy  burden  of  foreign  taxation.  Then  where  is  this 
"suffering,"  tliis  loss  to  be  found  ?  It  lias  vanished  ;  it  is  turned 
into  a  positive  gain,  in  all  cases,  and  with  all  parties  in  the  coun- 
try—  producers,  consumers,  buyers,  sellers,  exporters,  and  im- 
porters.    And  thus  the  whole  theory  falls  to  the  ground. 

It  was  on  the  basis  of  this  theory  that  nullification  rose  in  18.32 
—  disturbed  the  repose,  and  menaced  the  integrity  of  the  Union. 
The  South-Carolinians  were  made  to  believe  that  they  were  taxed 
millions  a  year,  "in  the  double  capacity  of  consumers  and  export- 
ers." Mr,  Clay,  in  his  reply  to  General  Hayne,  in  February, 
1832,  proved  very  satisfactorily,  that,  on  their  own  principle,  their 
tax,  as  a  state,  could  not  exceed  S333,000,  which  was  only  about 
one  third  of  their  fair  proportion  of  the  public  burden,  when  the 
revenue  from  customs  was  twenty-five  millions.  But  even  this 
burden  is  removed  by  the  proof  that  protective  duties  are  not  taxes. 

That  the  cotton-growing  interest  is  one  of  great  importance,  both 
to  the  country  and  to  the  world,  is  evident  enough  ;  and  those 
things  which  make  it  important  to  the  world,  all  contribute  to  make 
it  valuable  to  those  concerned  in  it.  But  the  following  statement 
of  the  secretary  of  the  treasury  on  this  point,  in  his  annual  report 
for  December,  1845,  deserves  a  qualification  and  some  abatement, 
in  several  particulars  : — 

"  Cotton  is  the  great  basis  of  our  foreign  exchange,  furnishing 
most  of  the  means  to  purchase  imports  and  supply  the  revenue. 
It  is  thus  the  source  of  two  thirds  of  the  revenue,  and  of  our  for- 
eign freight  and  commerce,  upholding  our  commercial  marine  and 
maritime  power.  It  is  also  a  bond  of  peace  with  foreign  nations, 
constituting  a  stronger  preventive  of  war  than  armies  or  navies, 
forts  or  armaments.  At  present  prices,  our  cotton-crop  will  yield 
an  annual  product  of  $72,000,000,  and  the  manufactured  fabric 
$504,000,000,  furnishing  profits  abroad  to  thousands  of  capitalists, 
and  wages  to  hundreds  of  thousands  of  the  working  classes,  all  of 
whom  would  be  deeply  injured  by  any  disturbance,  growing  out 
of  a  war,  to  the  direct  and  adequate  supply  of  the  raw  material. 
If  our  manufacturers  consume  400.000  bales,  it  would  cost  them 
$12,000,000,  while  selling  the  manufactured  fabric  for  $84,000,000  ; 
and  they  should  be  the  last  to  unite  in  imposing  heavy  taxes  on  that 
great  interest,  which  supplies  them  with  the  raw  material,  out  of 
which  they  realize  such  large  profits." 

The  most  impressive  feature  of  the  above  passage,  from  the  re- 
port of  the  secretary  of  the  treasury,  is  the  sympathy  and  concern 


484  THE    EFFECTS    OF    A    P.'IOTECTIVE    SYSTEM 

which  he  seems  to  manifest  for  British  capitalists  and  laborers,  a3 
contrasted  with  his  feelings  toward  7\merican  capitalists  and  labor- 
ers. To  the  former  he  is  more  than  courteous  ;  to  the  latter,  here 
and  throughout  the  report,  he  is  somewhat  severely  censorious. 
It  is  not  a  little  remarkable  that  lie  should  be  able  so  clearly  to  see 
the  dependence  of  these  "iiundreds  of  thousands"  of  British  "work- 
ing classes"  on  their  position,  in  connexion  with  their  employers, 
and  that  he  should  so  feelingly  deprecate  "  any  disturbance"  of 
that  position,  by  which  they  migl)t  be  "  deeply  injured  ;"  and  yet 
not  be  able  to  see  the  importance  of  not  disturbing  the  same  posi- 
tion of  American  laborers.  The  secretary  seems  to  have  great  sat- 
isfaction in  contemplating  the  growing  vvealih  of  British  capitalists, 
and  is  apparently  ready  to  vindicate  their  utmost  prerogative.  The 
slightest  exposure  of  the  British  "  working  classes"  to  injury,  very 
sensibly  affects  him.  This  does  not  appear  to  be  the  charity  that 
begins  at  home,  but  that  which  roams  abroad  for  beneficiaries. 

Could  he  not  think  what  would  be  the  benefit  to  American  la- 
bor—  without  injury  but  a  benefit  to  the  cotton-growing  interest, 
as  shown  in  another  part  of  this  chapter  —  if  50  per  cent,  of  the 
raw  cotton  exported  were  manufactured  in  this  country,  thereby 
retaining  the  six  additional  values  bestowed  upon  it,  not  less  than 
$200,000,000,  instead  of  retaining  only  the  $84,000,000?  —  The 
market  or  demand,  for  both  the  raw  cotton  and  its  fabrics,  would 
still  be  the  same  —  even  greater.  As  to  the  "  heavy  taxes  on  this 
great  interest,"  which  the  secretary  deprecates,  it  has  been  many 
times  answered  in  this  work.  If  such  a  monomania  were  not  a 
calamity  to  more  parties  than  one,  it  would  be  ludicrous  enough. 

In  the  next  place,  the  value  of  the  cotton-crop  in  this  statement 
is  hypothetical,  and  too  high.  According  to  the  secretary's  own 
tables,  the  export  of  that  year  was  only  $51,739,643;  and  the 
average  annual  expoit  from  1841  to  1845,  inclusive,  was  only 
$51,000,000.  Add  $12,000,000  for  home  consumption,  accord- 
ing to  his  statement,  and  it  would  be  only  $63,000,000,  instead  of 
$72,000,000. 

But  this  is  here  presented  by  the  secretary  as  a  great  interest. 
There  are  several  agricultural  products  of  the  country  of  greater 
value  than  that  of  cotton.  That  of  hay,  in  1844,  by  the  patent- 
office  report,  was  upward  of  17,000,000  tons,  which,  at  $10,  would 
be  $170,000,000.  Indian  corn,  in  1844,  was  422,000,000  bush- 
els ;  in  1843,  it  was  494,000,000;  and  in  1846,  probably  over 
500,000,000  :  which,  at  50  cents  a  bushel,  would  be  $250,000,000. 


ON    THE    COTTON-GROWING    INTEREST.  485 

Neat  cattle,  in  1840,  numbered  15,000,000  ;  now  (1847)  not  less, 
probably,  than  20,000,000  :  at  $10  a  head,  S200, 000,000.  Swine 
in  1840,  26,000,000  ;  say  30,000,000  now  :  at  S4  a  head,  $120,- 
000,000.  Horses  and  mules  are  estimated  at  $170,000,000. 
Oats,  172,000,000  bushels:  at  25  cents,  $63,000,000.  Hemp 
and  flax,  $20,000,000;  products  of  the  dairy,  $34,000,000,  &c., 
&c.  The  Hon.  Mr.  Stewart,  of  Pennsylvania,  has  estimated  the 
annual  agricultural  products  of  the  country  at  $1,000,000,000, 
which  the  above  items,  being  only  a  few  of  all,  though  the  largest, 
would  seem  to  justify  ;  and  a  senate  document,  cited  in  another 
chapter,  based  on  the  census  of  1840,  estimates  the  entire  annual 
product  of  the  industry  and  labor  of  the  country  at  $2,000,000,000. 
It  is  easy  to  see  what  proportion  the  annual  pi-oduct  of  cotton  — 
average  say  $60,000,000  —  bears  to  that  of  the  entire  labor  of  the 
country  ;  or  to  the  aggregate  of  agricultural  products;  or  to  either 
of  the  above  items  for  a  single  branch  of  agriculture,  six  of  which 
are  larger,  and  some  very  much  larger,  than  that  of  cotton.  Why 
did  not  the  secretary  name  some  of  these  as  great  interests  ?  And 
why  should  the  smallest  interest,  even  of  a  single  man,  in  the  gen- 
eral aggregate,  be  overlooked  ?  That  is  the  best  government  which 
has  a  care  for  all. 

But  the  secretary  ascribes  some  very  pretending  polifical  attri- 
butes to  the  cotton  interest,  for  which  he  seems  to  think  it  merits 
the  special  care  of  the  government.  "  Cotton  is  the  great  basis  of 
our  foreign  exchanges,  furnishing  most  of  the  means  to  purchase 
imports,  and  supply  the  revenue.  It  is  thus  the  source  of  two 
thirds  of  the  revenue,  and  of  our  foreign  freight  and  commerce, 
upholding  our  commercial  and  maritime  power.  It  is  also  a  bond 
of  peace  with  foreign  nations,  constituting  a  stronger  preventive  of 
war  than  armies  or  navies,  forts  or  armaments." 

It  can  not  be  denied  that  this  is  a  high  pretension,  an  extraordi- 
nary claim,  put  forward  on  the  basis  of  eminent  political  consider- 
ations ;  and  these,  apparently,  are  some  of  the  reasons  why  the 
secretary  thinks  that  all  other  interests  of  the  country  should  give 
way  to  that  of  cotton,  and  that  the  public  policy  should  be  shaped 
for  this.  Believing  in  these  facts,  as  he  has  stated  them,  his  course 
as  a  public  officer  may  be  easily  explained.  How  could  he  do 
otherwise  ? 

But  if,  after  all,  it  shall  appear  that  the  position  of  this  interest 
of  $72,000,000,  so  far  as  its  claims  to  protection  are  concerned, 
is  purely  a  commercial  one  ;  that  it  is  an  interest  of  so  many  dol- 


486  THE    EFFECTS    OP    A    PROTECTIVE    SYSTEM 

lars,  and  no  more,  in  the  pockets  of  the  growers  of  cotton  ;  that  so 
far  as  it  has  any  political  importance,  it  is  so  much  additional  com- 
mercial value  to  those  concerned  in  it,  and  therefore  can  only  be 
regarded  as  a  basis  of  commercial  speculation  —  and  a  very  strong 
one  it  is  ;  then  what  becomes  of  these  high  and  superior  claims  set 
up  for  it  ? 

As  to  the  political  importance  of  the  cotton  interest,  in  maintain- 
ing peace,  whatever  of  truth  there  is  in  it  —  and  there  is  doubtless 
a  good  deal  —  nevertheless,  it  all  redounds  to  the  commercial  ad- 
vantage of  that  interest,  rendering  it  always  more  secure,  more 
available,  more  productive.  As  to  the  credit  claimed  for  the  cot- 
ton interest,  in  affording  the  basis  for  two  thirds  of  the  public  rev- 
enue, the  fact  is  not  apparent.  England  must  have  the  cotton,  and 
the  planter  is  glad  to  sell  it.  These  are  facts.  But  why  does  the 
exporter  of  the  cotton  bring  back  merchandise?  Because  the  peo- 
ple want  it,  and  because  he  can  double  his  profits  by  the  operation. 
It  is  the  wants  of  the  people,  then,  that  constitute  the  basis  of  the 
public  revenue,  and  not  cotton.  If  it  should  be  said,  the  cotton 
pays  for  the  merchandise,  to  the  extent  specified,  this  fact  is  not 
inconsistent  with  another  contingent  one,  to  wit,  that  in  the  absence 
of  cotton,  something  else  would  be  found  to  pay  for  it.  As  to  the 
aid  of  cotton  in  providing  a  maritime  force,  by  employing  a  com- 
mercial marine,  that,  too,  rests  on  a  similar  foundation  to  the  other 
pretension  ;  and  if  it  should  be  granted,  would  it  not  be  fair  to  bal- 
ance the  account,  and  bring  the  cotton  interest  in  debt  to  the  coun- 
try, by  charging  back  upon  it  five  or  six  millions  a  year  for  the 
expense  of  a  navy  to  protect  it  on  its  passage  to  market  ? 

No  doubt  cotton  is  a  great  interest.  Nor  is  it  intended  to  dis- 
parage its  fair  relative  importance,  though  not  the  greatest  of  the 
Union.  But  it  can  hardly  be  allowed  to  claim  that  every  other 
interest  of  the  country  should  make  obeisance  to  that,  crouch  to  it, 
be  its  slave,  be  sacrificed  to  its  advantage.  Unfortunately,  the 
course  of  public  policy  proposed  for  the  benefit  of  the  cotton-grow- 
ing interest  is  as  bad  for  that  as  for  any  other,  not  to  say  worse. 
All  are  to  be  injured  by  a  mistake  of  the  advocates  of  this  single 
interest,  they  suffering  with  the  rest. 

The  president  of  the  United  States,  in  his  annual  message  of 
1845,  as  before  cited  for  another  purpose,  said  :  "  While  it  [the 
tariff  of  1842]  protects  the  capital  of  the  wealthy  manufacturer, 
and  increases  his  profits,  it  does  not  benefit  the  operatives  or  labor- 
ers in  his  employment,  whose  wages  have  not  been  increased  by 


ON    THE    COTTON-GROWING    INTEREST.  487 

it."  How  far  the  last  part  of  this  proposition  is  true,  has  been  be- 
fore considered.  The  secretary  of  the  treasury,  in  his  annual  re- 
port of  the  same  year,  said  :  *'  The  profit  of  capital  invested  in 
manufactures  is  augmented  by  the  protective  tariff."  It  may  be 
so,  ought  to  be,  doubtless  is,  as  one  object  of  the  tariff  is  to  en- 
courage and  sustain  manufactures.  But  the  secretary  maintains 
that  this  is  done  at  the  expense  of  laborers  and  the  poor. 

So  serious  an  allegation  as  this,  involving  so  important  a  ques- 
tion, and  emanating  from  such  a  quarter,  should  have  been  sub- 
stantiated by  the  evidence  oi  facts.  There  can  be  no  apology  for 
this  defect  of  duty,  inasmuch  as  it  was  perfectly  in  the  power  of 
the  secretary  to  prove  it,  if  it  was  true.  He  did,  in  fact,  open  a 
correspondence  in  all  quarters  for  that  purpose  ;  and  yet,  not  a  sin- 
gle fact  to  the  point  is  forthcoming.  He  complains  that  the  man- 
ufacturers would  not  give  evidence  to  convict  themselves.  But 
there  were  thousands  of  disinterested  and  well-qualified  persons 
whom  he  might  have  put  under  oath.  Their  certificates  would 
have  been  influential,  for  or  against  the  secretary.  The  fact  that 
he  did  not  produce  them,  is  the  strongest  evidence  that  they  could 
not  be  obtained  for  liis  purpose. 

The  secretary  does  indeed  say  :  "  It  seems  strange,  that  while 
the  profit  of  agriculture  varies  from  1  to  8  per  cent.,  that  of  manu- 
factures-is more  than  double."  This,  certainly,  is  a  very  equivo- 
cal mode  of  expression,  unexplained.  If  he  means  that  the  profit 
of  manufactures  is  more  than  double  of  1,  that  is  not  saying  much. 
Or  if  he  means  that  it  is  more  than  double  of  the  medium  between 
1  and  8,  that  is,  of  4  —  it  is  perhaps  fair  to  conclude  this  was  his 
meaning — even  that  is  not  very  extravagant,  and  is  probably  about 
what  he  meant  to  allow  for  agriculture.  But  whatever  he  meant, 
is  unsupported  by  evidence. 

Assertion  is  at  least  as  good  on  one  side  as  the  other,  and  when, 
in  replication,  it  happens  to  correspond  with  known  facts,  it  is  sim- 
ply a  reference  to  the  most  valid  evidence  —  is  evidence.  It  will 
not  be  denied  that  more  capital  has  been  sunk,  entirely  and  for 
ever  lost  to  the  original  stockholders,  in  starting  manufactories  in 
the  United  Slates,  than  in  any  other  business  whatsoever.  Nearly 
all  that  was  invested  during  the  war  of  1812,  and  under  the  tariff 
of  1816,  down  to  1S24,  was  sacrificed  ;  and  the  amount  was  very- 
great.  Hundreds,  not  to  say  thousands,  of  families,  who  were  rich 
before  tlieir  all  was  thus  hazarded,  were  for  ever  ruined  by  these 
misfortunes.     It  is  not  less  true  that,  in  the  history  of  manufactur- 


488  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

ino- in  the  United  States,  down  to  this  time,  frequent  failures,  some 
for  great  amounts,  have  been  constantly  taking  place.  On  these 
ruins,  others  following,  and  taking  the  same  establishments,  at  a 
laro-e  discount  on  the  cost  —  50  or  75  per  cent.,  sometimes  more, 
sometimes  less  —  have,  for  a  season,  been  able  to  make  large  div- 
idends, not  on  the  first  cost,  but  on  the  last.  What  was  their  good 
luck,  had  been  the  ruin  of  others.  In  the  same  manner,  handsome 
profits  have  sometimes  been  realized  by  the  first  establishments  in  a 
new  business,  till  other  capital,  waiting  for  employment,  rushed 
into  it,  and  reduced  the  profits  to  an  unsatisfactory  level,  as  is  gen- 
erally the  result  in  all  such  cases,  till  one  reaction  after  another 
brings  it  to  a  moderate  and  fair  business. 

The  Hon.  Mr.  Evans,  of  Maine,  whose  scrupulosity  and  accuracy 
of  statement  in  such  matters  were  never  questioned  by  his  opponents 
in  the  senate  of  the  United  States  or  elsewhere  —  much  less  are 
his  statements  often  disturbed  —  replied  to  Mr.  M'Duffie,  of  South 
Carolina,  on  this  point,  in  a  speech  delivered  January  23,  1844. 
His  conclusion  was  :  "  I  venture  to  affirm  that  the  profits  of  capital 
invested  in  cotton  manufactures  [these  are  the  most  profitable]  from 
the  commencement  to  this  time,  have  not  averaged  6  per  cent." 
Mr.  M'Duffie  asked,  "  What  are  they  now?"  —  "I  can  not  cer- 
tainly inform  the  senator,"  said  Mr.  Evans  ;  "  but  I  am  assured 
that,  altogether,  they  will  not  average  12  per  cent."  It  has  been 
since  proved  that  they  did  not  average  so  much  ;  and  it  is  doubt- 
less true  that  "  they  have  not  averaged  6  per  cent,  from  the  com- 
mencement." No  others  have  done  so  well,  and  some  have  suf- 
fered great  disasters. 

The  Lowell  factories  have,  undoubtedly,  done  better  than  the 
average  of  cotton-mills  in  the  country.  The  Hon.  Nathan  Apple- 
ton  states  that,  of  the  nine  companies  there,  five  made  no  dividend 
during  the  year  1842,  and  that  tlie  average  of  the  dividends  of  all 
the  Lowell  companies,  for  the  years  1842,  1843,  1844,  and  1845, 
of  the  net  profits,  was  10^  per  cent,  per  annum.  These  statements 
are,  of  course,  open  to  verification,  and  if  they  could  be  proved 
incorrect,  it  would  have  been  done,  as  there  was  no  want  of  dispo- 
sition. 

"I  am  very  sure,"  said  Mr.  Evans,  "that  in  other  branches  of 
manufacture  much  less  [profit]  still  has  been  derived.  How  is  it 
with  woollens?  The  profits  there,  we  know,  have  been  very  low; 
great  losses  have  been  sustained  ;  and  the  stock  has  been,  generally, 
far  under  par.     In  the  iron  business,  the  senator  from  Peunsylva- 


•  ON    THE    COTTON-GROWING    INTEREST.  489 

nia  [Mr.  Buchanan]  has  told  us  that  many  of  the  furnaces  have 
ceased  to  operate.  .  .  Witli  plain  and  conclusive  facts  like  these," 
said  Mr.  Evans,  "with  what  justice  or  propriety  can  tlie  act  of 
1842  be  sti2;niatized  as  an  act  to  legalize  plunder  and  oppression 
[so  Mr.  M'DufRe  called  it],  or  the  policy,  as  a  policy  to  enrich  the 
manufacturer  and  capitalist  at  the  expense  of  the  laborer?  These 
are  charges,  sir,  easily  made;  but  they  are  not  sustained,  and  can 
not  be  sustained  by  any  proof  drawn  from  experience,  or  the  prac- 
tical operation  of  the  system." 

But  what  are  the  profits  of  the  cotton-growers?  In  Mr.  Clay's 
reply  to  General  Hayne,  in  February,  1832,  he  said  :  — 

"  The  cotton-planters  of  the  valley  of  the  Mississippi  with  whom 
I  am  acquainted,  generally  expend  about  one  third  of  their  income 
in  the  support  of  their  families  and  plantations.  On  this  subject  I 
hold  in  my  hand  a  statement  from  a  friend  of  mine,  of  great  accu- 
racy, and  a  member  of  the  senate.  x\ccording  to  this  statement, 
in  a  crop  of  $10,000,  the  expenses  may  fluctuate  between  $2,800 
and  $3,200."  Again  :  "  If  cotton-planting  is  less  profitable  than 
it  was,  that  is  the  result  of  increased  production.  But  I  believe  it 
to  be  still  the  most  profitable  investment  of  capital  of  any  branch 
of  business  in  the  United  States;  and  if  a  committee  were  raised, 
with  power  to  send  for  persons  and  papers,  I  take  it  upon  myself 
to  say,  that  such  would  be  the  result  of  the  inquiry.  In  Kentucky, 
I  know  many  individuals  who  have  their  cotton  plantations  below, 
and  retain  their  residence  in  that  state,  where  they  remain  during 
the  sickly  season  ;  and  they  are  all,  I  believe,  without  exception, 
doing  well.  Others,  tempted  by  their  success,  are  constantly  en- 
gaging in  the  business,  while  scarcely  any  come  from  the  cotton 
re"-ion  to  eno;a(!:e  in  western  a2;riculture.  A  friend,  now  in  my 
eye,  a  member  of  this  body,  upon  a  capital  of  less  than  $70,000, 
invested  in  a  plantation  and  slaves,  made,  the  year  before  last, 
$16,000.  A  member  of  the  other  house,  I  understand,  who,  with- 
out removing  himself,  sent  some  of  his  slaves  to  Mississippi,  made, 
last  year,  about  20  per  cent.  Two  friends  of  mine,  in  the  latter 
state,  whose  annual  income  is  from  $30,000  to  $60,000,  being  de- 
sirous to  curtail  their  business,  have  offered  [cotton]  estates  for 
sale,  which  they  are  ready  to  show  by  regular  vouchers  of  receipts 
and  disbursements,  yield  18  per  cent,  per  annum.  One  of  my 
most  opulent  acquaintances,  in  the  county  adjoining  that  in  which  I 
reside,  having  married  in  Georgia,  has  derived  a  large  portion  of 
his  wealth  from  a  cotton  estate  there  situated." 


490       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

The  Richmond  (Va.)  Enquirer,  of  Nov.  13,  1846,  says:  "  Our 
neoToes  are  going  by  hundreds,  yea,  thousands,  to  the  southwest. 
The  domestic  can  not  compete  with  the  southwestern  demand  for 
them,  for  the  plain  reason,  that  the  tobacco-grower  can  not  make 
one  lialf  of  one  per  cent,  per  annum  upon  slave  labor,  while  the 
cotton  and  sugar  planters  make,  perhaps,  from  fifteen  to  twenty  per 

cent." 

So  far  as  this  evidence  goes  —  and  it  is  large  and  comprehensive 

it  proves  a  great  deal;  proves  what  agrees  with  common  report 

and  observation,  viz.,  that  cotton-planting  has  been  one  of  the  most 
lucrative,  money-making  pursuits  in  the  United  States;  that  fortunes 
have  been  made  quick  and  easy  by  it;  that  it  has  been  uniformly 
profitable  ;  that  vast  estates  have  been  amassed  in  this  calling ;  that 
men  have  grown  so  suddenly  and  greatly  rich  as  to  be  satisfied,  and 
vvillino-  to  sell  out,  when  the  business  was  worth  18  per  cent. ;  that 
it  is  a  business  which  is  not  liable  to  fluctuation,  and  never  fails; 
that  the  average  profit  can  hardly  be  less  than  20  per  cent,  on  the 
capital  invested,  when  it  has,  probably  a  long  time  and  extensively, 
been  very  much  better  than  that;  that,  if  prices  have  fallen  from 
the  enormous  profits  of  former  years,  it  has  been  owing  to  the  nat- 
ural tendency  of  capital  where  so  much  money  could  be  made, 
resulting  in  over-production  ;  and  that  the  business  is  still  one  of 
the  best  in  the  whole  country.  All  but  the  last  of  these  statements 
are  verified  by  Mr.  Clay's  evidence ;  and  for  the  last,  to  wit,  that 
this  business  is  still  the  best,  it  is  now  proposed  to  introduce  a  wit- 
ness whose  evidence,  considering  the  quarter  from  which  it  comes, 
as  well  as  for  its  forcible  and  convincing  character,  will,  perhaps, 
be  somewhat  surprising. 

In  1844,  Leavitt,  Trow,  &  Co.,  New  York,  published  a  book 
entitled,  "  Notes  on  Political  Economy,  as  applicable  to 
THE  United  States,  by  a  Southrn  Planter."  Among  the 
many  instructive  things  contained  in  it  (it  was  written  by  a  master- 
hand),  are  the  following:  — 

"  Let  us  now  calculate  what  cotton  can  be  grown  for  when  prices 
get  down  to  mere  support  for  master  and  slave.  With  the  proper 
economy,  by  the  owner  living  on  his  place,  deriving  his  household 
and  table  expenses  from  it,  and  clothing  and  feeding  his  own  slaves, 
his  annual  expenses,  consisting  of  salt,  iron,  medicine,  taxes,  wrap- 
ping for  his  cotton,  and  overseer's  wages,  do  not  exceed  2  cents  a 
pound  on  the  product  or  crop.  All  over  that  is  a  profit  in  their 
sense,  that  is,  over  and  above  annual  expenses.     I  will  give  the 


ON    THE    COTTON-GROWING   INTEREST.  491 

details  to  make  this  clear.     A  plantation  of  fifty  hands  makes  the 
average  of  seven  bales  to  the  hand,  weighing  four  hundred  and 
fifty  pounds.     This  is  three  hundred  and  fifty  bales.     Suppose  2 
cents  for  expenses.     This  amounts  to  $3,150  on  the  crop.     This 
crop,  say,  sells  for  4  cents  a  pound,  net,  and,  clear  of  charges  for 
transportation,  insurance,  and  commission  for  selling,  leaves  S3, 150 
profit  for  the  luxuries  of  the  owner,  who  gets  his  necessaries  out 
of  the  plantation  by  living  on  it.     This  is  a  very  pretty  sum;  and 
half  of  it  would  be  ample  for  him,  which  would  reduce  cotton  to 
three  cents.     As  to  insurance,  unfortunately,  the  slaves  not  only 
insure  themselves,  but  give  a  large  increase,  which  grows  up  with 
the  owner's  children,  and  furnishes  them  with  outfits  by  the  time 
they  need  them.     Now,  I  will  go  into  a  calculation  to  show  that 
two  cents  a  pound  cover  the  annual  expenses.     Here  follow  the 
items,  taking  a  plantation  of  fifty  hands  as  a  basis :  For  overseer, 
$500  ;  for  salt,  $20 ;   iron,  $30  ;   medicines,  $20  ;  doctor's  bill, 
$100,  for  you  can  contract  by  the  year,  and  it  is  often  done,  at  $2 
a  head  ;  bagging  and  rope  to  wrap  it  at  12^  cents  for  the  one,  and 
5  cents  for  the  other,  amounts  to  $300;  taxes,  $100 ;  sundry  small 
things,  $100  ;  all  told.     The  writer  speaks  from  experience,  for 
he  is  a  planter  of  cotton,  and  owns  slaves.     All  this  amounts  to 
$1,170,  much  below  the  allowance  of  2  cents  a  pound,  amounting, 
as  we  have  seen,  to  $3,150.     I  only  wish  to  show,  that  we  can  grow 
cotton  /or  3  cents  a  'pound,  and  have  a  living  'profit.   .   .   The  cot- 
ton culture,  then,  is  sure  to  go  on  in  this  country,  at  any  price,  from 
3  cents  up,  that  the  market  warrants,  and  with  increased  energies. 
These  facts  warrant  us  in  asserting,  which  we  do  broadly  and  un- 
qualifiedly, that  we  can  grow  cotton  cheaper  than  any  other  people 
on  earth,  not  even  excepting  the  Hindoos.     The  consequence  of 
this  will  be,  that  we  will  take  the  market  of  the  world,  and  keep  it 
supplied  with  cotton.  .  .  I  am  not  speaking  hypothetically,  when 
I  say  the  United  States  can  grow  all  the  cotton  wanted  —  have 
slaves  and  land  enough  to  do  it,  and  even  overdo  it.      [This  was 
written  before  there  was  any  serious  expectation  of  the  annexation 
of  Texas.]      This  country  can  raise  3,000,000  of  bales,  when  that 
much  is  wanted,  and   then  keep  ahead  of  the  consumption  far 
enough  to  prevent  arry  adi^ance  in  the  j)rice.  .  .  If  we  keep  cotton 
down,  not  to  its  minimum  price,  but  to  five  or  six  cents,  it  will 
cease  to  come  around  the  cape  of  Good  Hope,  and  the  United 
States  will  have  the  market  of  the  world,  just  as  certainly  as  at  three 
cents.  .  .  England  can  not  decline  taking  our  cotton,  because  it  is 


492       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 

cheapest,  and  because  she  has  buih  up  her  manufactories  on  the 
minimum  price  of  the  raw  material,  and  buys  it  wherever  chea[)est, 
and  has  conformed  all  prices  of  labor  and  goods  to  that  principle. 
She  has,  in  France  and  Germany,  as  well  as  in  us,  rivals  to  her 
cotton  manufactures,  and  such  skilful  rivals,  too,  that  she  dare  not 
pay  more  for  the  raw  materials  than  they  do.  If  she  were  to  pay 
two  cents  a  pound  more  for  cotton  than  we  do,  or  than  the  continent 
of  Europe  does,  she  would  lose  her  hold  on  the  cotton  manufac- 
ture, and  her  opponents  would  take  her  markets.  The  half- 
'pcnnij-d-yound  duly  vniv  levied  in  Eiighmd  icill  have  to  give  way  to 
insure  her  success.  [This  duty  was  taken  ofF  in  1845,  the  next 
year  after  this  remarkable  prediction  was  uttered.]  .  .  According 
to  the  opinions  of  our  most  deserving  and  most  skilful  commission 
merchants  and  factors,  our  own  [American]  spinners  are  now  worth 
fully  two  cents  a  youiid.  to  the  cotton  market,  each  and  every  year, 
by  the  competition  they  create  with  the  Europeans.  .  .  Fears  have 
been  expressed  that,  should  we  get  under  way  by  the  stimulus  of 
a  protective  tariff,  we  would  not  only  pass  the  dead  point,  but  go 
ahead  beyond  our  own  consumption,  so  as  to  aim  at  supplying  the 
whole  world  with  manufactures.  Such  arguments  cut  like  two- 
edged  swords,  and  show  how  much  might  be  done  under  protec- 
tion." 

The  above  extracts  are  a  little  more  comprehensive  than  what  is 
strictly  pertinent  to  the  point  of  the  comparative  profits  of  manu- 
facturing and  cotton-growing.  Nevertheless,  they  exhibit  some 
practical  suggestions  of  great  importance  relative  to  the  subject. 
One  of  them  is  a  maximum  price  of  cotton,  five  to  six  cents,  that 
will  be  best  for  the  country,  though  not,  perhaps,  for  individual 
growers,  except  as  it  might  prove  to  be  their  interest  thus  to  com- 
mand the  market  of  all  the  world.  It  is  clear  that  the  prices  can 
not  be  kept  up  as  high  as  they  have  been,  so  long  as  the  business 
is  so  profitable,  and  so  attractive  to  capital.  It  may,  therefore,  be 
better  for  each,  as  it  would  be  better  for  the  aggregate  interest,  that 
prices  should  come  down  to  that  point,  which  will  secure  an  ex- 
clusive market  in  all  quarters.  The  idea  suggested  by  this  writer, 
that,  in  such  a  case,  it  would  be  policy  to  'prevent  the  rise  of  prices 
above  that  point,  is  doubtless  repugnant  to  the  complaint,  that  they 
have  already  fallen  too  low.  But  it  will  be  hard  to  disturb  his 
reasoning.  The  clearness  with  which  he  has  set  forth  the  position 
of  England,  in  her  absolute  dependence  on  American  cotton,  will 
be  appreciated.     It  will  be  seen  that  it  disposes  of  the  argument 


ON    THE    C^)TTO.V-GtlOWING    INTEREST.  493 

that  Enn^land  vvoiild  purchase  less  of  American  cotton  under  an 
Amer'can  protective  system,  and  proves  that  slie  would  rather  be 
forced  to  purchase  more,  to  keep  her  own  markets,  which  would 
be  exposed  to  American  and  other  competition.  In  any  case,  these 
rival  interests  would  necessarily  enlarge  tlie  field  of  demand  for 
manufactured  cottons,  and  the  world  must,  be  supplied,  which 
necessarily  increases  the  demand  for  the  raw  material.  With  those 
who  wish  to  sustain  and  raise  the  price  of  American  cotton,  the 
two-cent s-a-yound  sustaining  power,  imparted  to  it  by  American 
spinners  —  admitting  the  fact  —  could  hardly  be  unwelcome  to  them; 
and  it  will  be  difficult  to  avoid  the  conclusion,  that  the  fact  is  so. 

Witii  the  facts  afforded  by  the  "  Southern  Planter,"  as  to  the  ex- 
pense of  raising  cotton,  it  is  only  necessary  to  find  what  have  been 
the  prices  of  cotton,  during  the  history  of  its  production  in  the 
United  States,  down  to  the  present  time,  and  its  price  now,  to  have 
a  just  idea  of  the  profits  of  the  business.  In  a  variety  of  instructive 
and  useful  statistics  on  cotton,  published  in  the  "  National  Intelli- 
gencer," Sept.  8, 184G,  which  had  been  prepared  with  great  care  by 
a  Virginia  gentleman,  is  a  column  of  the  average  price  of  cotton 
per  pound,  for  each  year,  from  1790  to  1838,  as  follows  in  the  note 
below.* 

*  Years.  Cents.  Years.  Cents.  Years.  Cents. 

1790 U\  1807 2\\  1823 10  and  12 

1791 26  1808 19  1824 15 

1792 29  1809 16  1825 21 

1793 .32  1810 16  1826 11 

1794 33  1811 15|  1827 9i 

1795 36i  1812 lO-J  1828 10^ 

1796 36^  1813 12  1829 10 

1797 34  1814 15  1830 10 

1798 39  1815 21  1831 9J 

1799 44  1816 29|  1832 10 

1800 28  1817 26A  1833 11 

1801 44  1818 34  1834 13 

1802 19  1819 24  1835 16* 

1803 19  1820 17  1836 16f 

1804 20  1821 16  1837 14| 

1805 23  1822 16^  1838 10| 

1806 22 

By  a  table  in  the  report  of  the  secretary' of  the  treasury,  1845,  on  page  612,  these 
average  prices  are  brought  down  to  1844,  inclusive.     It  begins  with  1833 : — 
Years.  Cents.        Years.  Cents.       Years.  Cents. 

1833 11  1837 14  1841 10 

1834 12         1838 10         1842 8 

1835 16         1839 14         1843 6 

1836 16         1840 8         1844 8 

The  slight  variatioa  in  six  concurrent  years,  from  1833  to  1838,  inclusive,  in 


494       THE  EFFECTS  OF  A  PROTECTIVE  SVSTEM 

There  is  enough  in  all  this,  to  show,  in  connexion  with  the  evi- 
dence of  Mr.  Clay,  and  the  practical  statements  of  the  "Southern 
Planter,"  first,  that  cotton-growing  in  the  United  Slates,  has  been 
not  only  a  very  profitable  business,  down  to  this  time,  but  by  far 
the  most  profitable  of  any  in  the  country  ;  secondly,  that  it  has 
never  seen  a  day  of  adversity  ;  and  thirdly,  that  it  occupies  a  com- 
mercial position,  in  relation  to  the  wants  of  mankind,  and  to  the 
rest  of  the  world,  which,  for  an  indefinite  future  period,  apparently 
for  ever,  is  very  sure  to  command  uninterrupted  prosperity  and 
great  profits. 

And  this  is  the  interest  which  complains  of  the  profits  of  manu- 
facturing, when  the  latter,  in  its  best  days,  never  did  so  well  as 
cotton-growing  in  its  poorest  days  ;  when  cotton-growing  never 
failed  —  can't  fail,  except  as  the  crop  fails,  and  then  the  price,  or- 
dinarily, will  make  it  up — whereas,  manufacturing  has  broken 
down  many  times  —  has  sunk  more  money,  and  ruined  more  for- 
tunes, than  has  happened  to  any  other  interest  in  the  land. 

But  to  show  how  a  protective  system  operates  on  the  cotton- 
growing  interest  of  the  United  States,  we  beg  leave  to  call  attention 
to  a  method  of  proof  and  argument  of  a  very  remarkable  character, 
and  which,  we  think,  will  conclude  all  controversy  on  the  question. 
It  is  contained  in  "  a  speech  of  Mr.  Simmons,  of  Rhode  Island, 
upon  the  resolutions  to  postpone  the  bill  irvtroduced  by  Mr.  M'Duffie, 
of  South  Carolina,  to  reduce  the  duties  on  imports,  delivered  in 
United  States  senate,  March  27,  1844,"  and  will  be  found  in  the 
note  below.* 

these  two  authorities,  establishes  at  least  the  fidelity  of  the  first,  if  it  should  sug- 
gest that  there  may  have  been  a  motive  in  the  second  (it  was  sent  to  the  secretary 
from  South  Carolina,  in  answer  to  one  of  his  circulars),  for  making  the  price  as  low 
as  fairness  would  allow.  Both  are  doubtless  worthy  of  confidence,  and  in  any  case 
are  accurate  enough  for  the  present  purpose. 

It  is  proper  to  remark,  that  the  higher  prices  of  furmer  years  do  not  determine 
the  question  of  comparative  profits  in  the  business  at  different  times.  The  advan- 
tages of  experience  and  sundry  improvements,  might  make  the  prices  of  latter  years 
more  profitable  tlian  those  of  the  former.  The  right  of  using  Whitney's  cotton- 
gin,  was  open  to  all  in  1800.  It  will  be  seen  that  the  prices  have  never  yet  come 
down  to  the  maximum,  five  to  six,  which  the  "Southern  Planter"  thinks  would  be 
best  for  the  interest,  and  that,  for  the  last  twenty  of  these  years,  from  1825  to  1844, 
inclusive,  they  amount  to  an  average  of  11  1-5  cents  (taking  the  secretary's  prices 
as  far  as  they  go),  leaving  nearly  four  time?  a  living  profit,  which  is  three  cents. 
The  average  prices  of  the  first  thirty-five  years,  from  1790  to  1824,  inclusive,  were 
twenty-four  cents,  or  eight  times  the  living  profit  of  the  present  period. 

•"  I  will,"  said  Mr.  Simmons,  "give  a  statement  of  the  results  of  an  exchange 
of  one  hundred  bales  of  cotton  in  each  country  for  heavy  sheetings — the  cheapest 
article  in  his  long  list,  substance  considered: — 


ON    THE    COTTON-GROWING    INTEREST.  495 

We  proceed  to  observe,  that  a  protective  system  increases  the 
demand  for  raw  cotton,  sustains,  and   tends   to  raise,   its  prices. 

Comparative  Stutement  of  the  Effect  of  exchanging  one  hundred  Bales  of  Cotton  for 
brown  Sheetings  in  England  and  the  United  States,  at  the  ruling  Prices  in  both 
Countries  for  Sheetings  mie  Year  ago,  as  quoted  by  Mr.  M'Duffie's  Tables,  and 
for  fair  Cotton  as  quoted  in  Liverpool  and  American  Price  Currents  at  the  same 
time  : — 

Amount  of  sales  in  Liverpool  of  100  bales  of  cotton 42,000  lbs. 

Draught  1  pound  per  bale,  is  100  pounds 100 

Tare  4  pounds  per  cwt.  on  375  cwt.  is 1,500 — 1,600 


40,400  lbs. 

At  4|(i.  per  pound=8f  cents $3,535  00 

Cliarses  in  the  United  States  and  Liverpool : — 

Baggins;,  twine,  mending,  and  marking $14  50 

Wharfase,  $4;  cartage,  $10;  storage  $8 22  00 

Fire  insurance,  $3.81  ;   postage,  &c.,  $3.50 7  31 

Marine  insurance,  1  per  cent,  on  $3,578.81 35  79 

Policy 1  25— $80  83 

Dock  dues,i:4  Os.  6rf. ;  town  dues,  16s.  8rf.=  £4  17s.  2d 23  32 

Duty  35d.  per  cwt.  on  360  cwt.,  2  qrs.,  24  lbs 252  50 

Cartage,  porterage,  and  weighing,  X3  14s.  Id 17  78 

Canvas)^,  twine,  and  mending,  £2  9s II  76 

Warehouse  rent,  Id.  per  week  for  12  weeks,  £5.    24  00 

Postages  and  small  charges,  10s.  6d 2  52 

Brokerage,  frf.  per  ct. ;  insurance,  ^d.  per  ct. ;  3  mos.  10  ds.  in- 
terest discount  l\d.  =  \^d.  on  £731  9s.  2<i.  is£l3  16s.  Id..  66  26 

Freight,  at  hd.  per  pound,  on  40,400  lbs.,  is  £84  3s.  4d 404  00 

Five  per  cent,  primage  on  freight,  £4  4s.  2d 20  20 

Commis'n  and  guaranty,  3  pr  ct.  on  £736  9s.  id.,  is  £22  Is.lO^d.  106  05 

Three  months'  interest  on  cash  charges,  $974.70 14  62—1,023  86 


Net  amount  of  proceeds,  in  Liverpool,  of  100  bales  cotton $2,51 1  14 


This  amount  of  proceeds  invested  in  best  stout  English  sheet- 
ing, as  quoted  in  Mr.  M'Duffie's  tables,  at  3|rf.=7f  cts. — 
per  yard,  is  30,859  yards $2,391  57 

Commission  for  purchasing,  freight  from  Manchester  to  Liv- 
erpool, dock  dues,  &c.,  5  per  cent 119  57-$2,511  14 

The  proceeds  of  lOt)  bales  of  cotton,  invested  in  sheeting  for  planter's 

account,  amounting  as  above  to 30,859  yds. 

Deduct  amount  for  freight,  insurance,  interest  on  the  goods  during  voy- 
age from  Manchester  to  the  United  States ;  also,  interest  on  cotton     ■ 
to  Liverpool,  and  time  it  remained  unsold  there,  and  other  charges  of 
imprutation — 10  per  cent 3,086  yds. 


Quantity  of  sheetings  returned  to  the  planter 27,733  yds. 

"Proceeds  of  the  same  quantity  of  cotton  sold  in  the  United  Stales 
and  invested  in  sheetings: — 

100  bales  of  cotton— 42,000  pounds— at  6|  cents,  is $2,730  00 

Bill  of  43,750  yards  of  sheeting,  at  6^  cents,  is $2,843  75 

Deduct  8  months'  interest  for  cash 113  75— $2,730  00 


496  THE    EFFECTS    OP    A    PROTECTIVE    SYSTEM 

And  this  must  be  evident  from  the  foregoing  facts  and  reasonings, 
thougli,  as  shown  by  the  "Southern  Planter,"  above  cited,  it  may 

BESULT. 

"The  one  hnndrci  bales  of  cotton  pays  for  43,750  yards  of  sheetings — cotton 
sold  and  sheetings  bought  in  the  United  States. 

"  The  same  cotton  pays  for  27,773  yards  of  sheetinss — cotton  sold  and  sheet- 
ings boiisht  in  England  ;  or,  in  other  words,  it  is  57  per  cent,  in  favor  of  the  Ameri- 
can trade,  if  llie  a:oods  are  imported  free. 

"  It  tlius  appears  that  the  planter  can  fjet  for  his  one  hundred  bales  of  cotton,  in 
this  country,  a  much  larger  amount  of  (57  per  cent,  more)  of  equal  goods  than  in 
England,  without  duty. 

"To  see  how  it  would  affect  the  planter  and  the  country,  if  ihe  trade  were  in- 
creased as  the  senator  proposes,  foreigners  made  its  agents  in  everything  to  aid 
them  to  purchase  our  cotton,  and  our  manufactures  abolished,  I  will  consider  the 
whole  cotton  crop  sold  in  England,  the  proceeds  converted  into  cotton  goods  for 
our  consumption,  and  these  imported  free  of  duty  in  this  country,  and  also  at  his 
proposed  duty  of  20  per  cent. 

"This  I  illustrate  by  an  example  of  one  hundred  bales,  and  also  by  one  embra- 
cing a  crop  of  two  millions  of  bales  : — 

Sales  of  one  hundred  Bales  of  Cotton  in  Liverpool,  at  Prices  of  Febrtiary  3,  1844, 
and  Proceeds  invested  in  best  English  Sheeting  at  the  English  Prices,  as  per  Ta- 
bles of  Mr.  M'Duffie,  of  January  31,  1843,  and  sold  at  the  Prices  of  last  Spring 
(1843),  also  per  Tables  of  Mr.  M'Duffie,  vnlh  o.n  Edition  of  25  per  cent,  for  the 
Advance  in  Price  of  such  Goods  during  ihe  past  Year. 

SALES    OF    100    BALES    COTTON. 

100  bales  of  cotton 42,000  lbs. 

Draught,  1  lb.  per  bale,  100  lbs. ;  tare,  4  lbs.  per  cwt.  on  375  cwt.  1,500     1,600  lbs. 

40,400  lbs. 

At  5ld.=  1  li  cents $4,646  00 

Deduct  charges  in  United  States  and  Liverpool,  as  per  statement  No.  1, 

annexed 1,023  86 

Net $3,622  14 

PURCHASE   OF    SHEETING. 

Invested  in  English  sheeting  at  prices  of  1843,  with  an  advance  of  25 
per  cent,  for  rise  since  : — 

36,65fif  yds.  of  sheeting,  called  in  England  "stouts  or  domes- 
tics," 21  yards  to  the  pound,  at  3|(i.=  7|  cents  per  yard ..  $2,840  90 

Charges  : — 

Commission  for  purchasing,  freight  from  Manchester  to  Liv- 
erpool, dock  dues,  &c.,  2  per  cent 56  82 

$2,897  72 
Add  25  per  cent,  for  advance  in  price  in  English  market  since 

January,  1843 724  43—3,622  15 

SALES    OF    SHEETING    IN    THE    UNITED    STATES. 

36,65fif  yards  (at  the  same  price  of  American,  and  of  same  quality, 
weighing  2^  yds.  to  the  lb.,  Laurence  C,  as  per  table,  for  spring  pri- 
ces of  1843),  6^  cents $2,382  69 

Add  2  cents  per  yard  on  36,656|  yards  for  rise  in  price  since  January, 

1843,  as  per  table 733  14 

$3,115  83 


ON    THE    COTTON-GROWING    INTEREST.  497 

be  doubtful  whether  this  is  best  for  the  interest.     If  it  should  be 
thought  best  to  push  the  growth  of  cotton  in  the  United  States,  till 

Charges  : — 

Expenses  of  importation,  7|  per  cent,  on  $3,622  15,  cost  on 

shipboard $271  65 

Labor,  cartage,  storage,  advertising,  fire  insurance,  &c.,  1  pr.ct.       31  22 
Interest  for  9  months  (sold  on  8  months'  credit,  1  month  after 

receipt),  4|  per  cent,  on  $2,959  20 133  16 

Commiss'n  and  guaranty  on  gross  sales,  $3,115  83,  at  5  pr.  ct.     155  79  —  $591  82 


Net  proceeds $2,524  0 1 

for  the  100  bales  shipped  to  Liverpool  and  invested  in  sheeting,  and  sold  in  New 
York  at  prices  of  1844,  being  a  rise  of  31  per  cent,  from  prices  of  1843. 
"  Now  suppose  the  100  bales  of  cotton  to  have  been  sold  in  this  country  at  the 
prices  of  February  3,  1844,  it  would  have  been  sold  at  9f  cents. 

100  bales  of  cotton,  42,000  pounds,  at  9f  cents $4,095  00 

Saving — 1   month  in   voyage  to  Liverpool;   2  months  while  on  hand 

there ;  and  1  month  for  return  voyage=4  mos.  interest,  2  per  cent.. . .  81  90 


$4,! 76  90 
Deduct  amount  of  sales  of  sheeting 2,524  01 


Difference  saved  in  sellin?  cotton  in  the  United  States $1,652  89 

"  The  cotton  yielding  66  per  cent,  more  by  selling  in  the  United  States,  than  by 
shipping  to  Liverpool  and  importing  sheetings  and  selling  them  in  the  United 

States — AND  THIS,  TOO,  WITHOUT  DUTY  IN  THIS  COUNTRY. 

"The  price  of  fair  cotton  is  taken  from  Wilmer  &  Smith's  Price  CuiTent  of  Feb- 
ruary 3,  1844.  The  price  of  best  English  sheeting,  and  best  American  (Laurence 
C)  of  same  quality  is  taken  from  Mr.  M'Duffie's  table  accompanying  his  speech. 

"  In  this  example,  if  a  duty  of  20  per  cent,  ad  valorem  had  been  computed  on  the 
goods  imported,  it  would  have  amounted  to  $724  42,  and  the  100  bales  of  cotton 
would  have  net  but  $1,799  59;  and  it  would  have  produced  132  per  cent,  more,  if 
sold  in  this  country  at  prices  in  New  York  at  the  same  time  (February  3,  1844), 
deducting  one  cent  per  pound  for  charges  for  freight  from  southern  ports,  com- 
missions, .tc. 

Statement  of  the  jlccount  of  two  miUion  Bales  of  Cotton  sold  in  Liverpool,  and  the 
Proceeds  invested  in  best  English  Sheeting  (that  being  the  cheapest  article  accord- 
ing to  substance),  and  the  Sheeting  sold  in  the  United  States  for  Account  of 
Planters. 

2,000,000  bales,  420  pounds  each 840,000,000  lbs. 

Draught,  1  pound  per  bale 2,000,000  lbs. 

Tare,  4  lbs.  per  cwt.  on  7,500,000  cwt 30,000,000  lbs.  —  32,000,000  lbs. 


808,000,000  lbs. 


At  5|d.  =  l  1|  cents  per  pound,  is $92,920,000  00 

Deduct  charges  in  United  States  and  Liverpool,  as  per  statement 

No  1,  annexed 20,477,200  00 

$72,442,800  00 
Purchase  of  sheeting  : — 
Invested  in  English  sheeting  at  prices  of  1843,  as  per 

Mr.  M'Duffie's  table,  with  an   advance  of  25  per 

cent,  for  rise  since  —  733,133,966  yards  of  sheet- 

32 


498  THE    EFFECTS    OF    A    PROTECTIVE    SYSTEM 

its  prices  shall  be  reduced  to  the  maximum  that  would  command 
the  market  of  the  world,  the  way  is  open  ;  and  it  is  possible  that 

ing,  called  in  England  "  stouts  or  domestics,"  weigh- 
in"'2i  yards  to  the  pound,  at  3|d.=7i  cents  per 

',    .  $56,817,882  36 

yard,  IS ^     '       ' 

Commission  for  purchasing,  freight  from  Manches- 
ter to  Liverpool,  dock  duty,  &c,,  2  per  cent 1,136,357  64 

$57,954,240  00 
Add  25  per  cent  for  advance  in  price  in  English  mar- 
ket since  January,  1843 14,488,560  00-$72,442,800  00 

Sales  of  sheeting  in  the  United  States  :— 

733,133,966  yards  (at  the  same  price  of  American,  and  of  same  qual- 
ity, weighing  2|  yards  to  the  pound,  Laurence  C,  as  quoted  in  Mr. 
M'Duffie's  tables  for  spring  prices  of  1843),  at  6|  cents  per  yard  $47,653,707  77 

Add  2  cents  per  yard  on  733,133,966  yards,  for  rise  since  January, 

1843,  as  per  iVIr.  M'Duffie's  table 14,662,679  32 

Charges:-  $62,316,387  09 

Expenses  of  importation,  7^  per  cent,  on  $72,442,800, 

cost  on  ship  board,  is $5,433,210  00 

Labor,cartage,  storage,  advertising,  insurance  against 

•     fire,  1  per  cent 623,163  87 

Interest  9  months  (sold  on  8  months'  credit  1  month 

after  receipt),  4^  per  cent,  on  $59,200,567  64. . . .     2,664,025  54 
Commission  and  guaranty  on  gross  sales,  5  per  cent. 

on  $62,316,387  09 3,115,819  45-1 1,836,218  86 

Net  proceeds,  without  duty $50,480,168  23 

With  a  duty  of  20  per  cent,  on  foreign  cost,  $72,442,800,  is 14,488,560  00 

$35,991,608  23 

Explanation  of  the  result  of  this  impolitic  routine  of  business  : — 

Paid  to  English  manufacturers  for  goods  more  than  the  same  arti- 
cle could  be  purchased  for  in  this  country $10,126,412  91 

Expenses  paid  on  importing  and  selling  the  goods 1 1,836,218  86 

Loss  to  planters  without  duty $21,962,631  77 

Duty  paid  in  this  country,  20  per  cent 14,488,560  00 

Loss  with  20  per  cent,  duty $36,451,191  77 

"  To  have  sold  the  cotton  in  the  United  States  for  cash  at  9|  cents,  the  price  of 
February  3,  1844,  it  would  have  netted  $46,268,398  more,  or  130  per  cent.,  than 
if  exchanged  for  coarse  sheeting  in  England  and  sold  in  this  country  at  prices  of 
January,  1843,  with  two  cents  a  yard  addition  for  rise  since.  The  consumption  of 
the  United  States  of  cotton  goods  requires,  say  three  sixths  coarse  sheeting,  drilling, 
&c.,  two  sixths  prints,  and  one  sixth  bleached  shirting,  &c.  If  such  goods,  and  in 
these  proportions,  had  been  imported  (instead  of  all  coarse  sheetings),  the  two  mill- 
ion bales  of  cotton  would  have  netted  $37,474,728,  instead  of  $35,991,608,  a  differ- 
ence of  $1,483,120,  or  about  4  per  cent.  more. 

"  Since  February  3,  1844,  the  time  when  the  estimates  were  made  of  the  price 
of  cotton  in  both  countries,  it  has  receded  1|  cents  per  pound.  If  we  estimate  at 
present  prices  for  the  crop,  it  would  yield  in  the  United  States  $69,360,000.  As 
the  return  in  cotton  goods,  of  the  most  favorable  descriptions  (brown  sheeting, 
prints,  and  bleached  shirting),  for  the  crop  sold  in  Europe,  yields  $37,474,728,  the 


ON    THE    COTTON-GROWING    INTEREST.  499 

this  may  be  the  natural  result  of  competition.     But,  in  any  case, 
the  protective  policy  is  favorable  to  prices.     The  more  the  United 

differpnce  between  selling  and  investing  in  England,  and  selling  here,  would  be  but 
$31,885,272,  or  about  85  per  cent,  more,  by  selling  in  the  United  States. 

"  Let  us  contrast  the  effect  of  this  foreign  plan,  as  presented  in  the  foregoing 
table,  with  the  result  of  the  American  sy  stem  of  trade  and  commerce  upon  the  same 
crop  of  cotton  : — 

"  Of  a  crop  of  2,000,000  bales,  say  one  fourth  is  consumed  in  this  country,  and  three 

fourths  in  foreign  countries: — 
500,000  bales,  210,000,000   pounds,  worth  in  the  northern  markets 

February  1,  1844,  at  lOf  cents $22,375,000 

Expenses  —  freights  and   shipments,    coastwise,   secured  by  law  to 

Americans,  and  labor,  &c.,  at  1  cent  per  pound 2,100,000 

In  southern  ports  —  for  planters 20,275,000 

1,500,000  bales  sent  to  foreign  countries,  and  sold  at  the  same  prices 
at  which  it  ruled  February  3,  1844,  5f(i.  =  11^  cents, 

on  606,000,000,  is $69,690,000 

Paid  American  shipowners,  merchants,  &c.,  for  freight 

and  commission $10,1 14,800 

Paid  foreign  duties,  dock  dues,  &c 5,243,100—15,357,900 

54,332,100 

Net  amount  to  planters  for  crop 71,607,100 

Deduct  amount  of  same  crop  received  when  disposed  of  upon  foreign 
system 37,474,728 


Difference  in  favor  of  planters  of  the  American  over  the  foreign  system    37,132,372 

"Let  us  present  the  effect  upon  the  whole  country: — 
"The  1,500,000  bales  sold  in  Europe,  including  freight,  &c.,  paid  to  Americans  (if 

invested)  in  such  merchandise  as  is  required  in  the  United  States,  will  sell  for 

enough  to  pay  cost  and  charges,  as  follows: — 

Sales  of  cotton  abroad $69,690,000 

Less  amount  paid  foreigners,  duties,  dock  dues,  &c 5,243,100 

$64,446,900 

Add  charges  abroad  for  purchasing,  2  per  cent 1,288,936 


65,735,836 
Add  freight  and  charges  to  United  States,  1^  per  cent 4,930,187 


70,666,623 
Of  this  amount,  say  two  thirds  are  dutiable  goods,  at  30  per  cent,  on 
$47,111,032,  is 14,133,324 

84,799,947 
Interest,  and  profit,  and  small  charges,  10  per  cent 8,479,994 


The  value  of  the  goods  in  the  United  States 93,279,941 

Of  which  there  would  be  to  pay  planters  for  net  sales  abroad 54,332,100 

38,956,841 
Deduct  for  charges  in  England 1,288,936 

Leaving  to  distribute  between  the  government,  shipowners,  laborers, 
merchants,  &c 37,767,905 


500       THE  EFFECTS  OF  A  PROTECTIVE  SYSTEM 


States  o-o  into  the  manufacture  of  cotton,  so  much  more  will  it  be 
necessary  for  the  British  manufacturers  to  push  their  work,  and 
ply  their  commerce,  to  hold  their  own  markets,  and  gain  others. 
Their  salvation  and  that  of  the  British  empire,  depend  on  this. 
The  competition  between  the  British  and  American  manufacturers, 
under  a  good  system  of  Protection  for  the  latter,  can  not  be  worth 
less,  as  shown  by  the  "  Southern  Planter,"  than  one  to  two  cents 
a  pound  to  cotton  ;  and  the  quantity  in  demand  will  be  constantly 
increased  and  increasing,  on  account  of  this  competition.  It  is 
amazing  that  the  cotton-growers  should  not  have  discovered  this 

The  500,000  bales,  manufactured  in  this  country,  would  produce  three 

times  the  value  of  the  raw  cotton $67,125,000 

To  pay  planters  in  southern  shipping  ports 20,275,000 

Leaving  to  distribute  among  laborers,  mechanics,  manufacturers,  mer- 
chants, shipowners,  and  farmers 46,850,000 

"  The  entire  value  of  the  cotton  crop,  according  to  the  American  system,  to  wit: 

500,000  bales  manufactured $67,125,000 

1,500,000  bales  shipped  abroad,  freights,  duties,  &.c 93,279,94 1 


Of  which  the  cotton  planter  would  receive  for  sales  in 

the  United  States $20,275,000 

Sales  in  foreign  countries 54,323,100 


$160,404,941 


The  merchants,  manufacturers,  mechanics,  shipowners, 
farmers,  and  laborers,  for  that  part  manufactured  in 

this  country $46,800,000 

For  that  part  shipped  abroad,  $37,767,905 

Foreigners 1,288,936—38,956,841 


$74,598,100 


85,806,841 
160,404,941 


By  American  system —  

Planters  receive $74,598,100     Other  Americans $84,517,905 

By  foreign  system  — 

Planters  receive 37,474,428     Other  Americans 1,463,163 


Difference  in  favor  of  American 

system,  to  planters 37,123,672     To  other  Americans..     83,053,742 

•  By  American  system — Planters  and  other  Americans  receive,  in  total,  $159,1 16,005 
By  foreign  system — Planters  and  other  Americans  receive,  in  total,      38,937,591 

Total  difference  in  favor  of  American  system  to  planters  and  others,  $120,178,414 

"  If  business  had  been  encouraged,  so  that  the  increase  of  manufactures  had 
kept  pace  with  the  production  of  cotton,  we  would  now  manufacture  nearly  or  quite 
the  whole  crop,  and  produce  an  annual  amount  of  $268,500,000  of  these  manu- 
factures. 

"  This  business  would  not  only  have  secured  a  certain  market  for  our  crop  of 
raw  cotton,  but  would  have  created  a  demand  for  agricultural  productions  for 
double  the  amount  of  all  which  we  now  export  to  all  nations." 


ON    THE    COTTON-GROWING    INTEREST.  601 

before  ;  but  the  following  facts  will  show  that  they  are  beginning  to 
see  it  now.  A  convention  of  one  hundred  and  four  cotton-planters 
in  Mississippi,  in  1845,  passed  a  series  of  resolutions  in  favor  of  the 
protective  policy,  of  which  the  following  are  extracts :  "  That  they 
are  in  favor  of  the  tariff  of  1842,  because  it  affords,  as  they  believe, 
adequate  protection  to  all  kinds  of  domestic  labor,  and  renders  it 
independent,  not  only  in  name,  but  in  fact;  because  it  will  induce, 
at  the  north,  large  investments  of  capital,  and  the  employment  of  a 
large  number  of  laborers,  in  the  manufacture  of  cotton  goods;  that 
it  will  extend  the  consumption  of  manufactured  articles,  and  there- 
by increase  the  demand  for  the  raw  material ;  that  it  will  give  the 
growers  of  cotton  two  markets,  instead  of  one,  and  one  of  these  a 
home  market ;  because  it  protects  indirecdy  the  growers  of  small 
grain,  and  gives  them  a  home  market ;  because  it  protects  indi- 
rectly the  hemp-growers,  and  keeps  the  large  amount  of  capital 
now  invested  in  that  business  from  being  employed  in  the  culture 
of  cotton  ;  because  it  protects  indirectly  the  breeders  of  hogs,  hor- 
ses, and  mules,  and  gives  them  a  home  market ;  because  it  protects 
the  producer  of  sugar,  gives  him  a  home  market,  and  prevents  the 
vast  amount  of  capital  and  labor  invested  in  the  culture  of  cane 
from  being  directed  to  the  already  redundant  production  of  cotton  ; 
because  all  experience  proves  that  its  ultimate  tendency  is  to  re- 
duce the  price  of  manufactured  goods,  and  thereby  benefit  consu- 
mers of  all  classes ;  because  no  one  great  interest  of  the  country 
can  be  adequately  protected,  without  in  some  degree  extending 
protection  to  all  other  interests,  and  that  none  derive  more  essential 
benefit  from  the  general  prosperity  of  other  pursuits  than  the  cotton- 
grower  ;  because  the  interests  of  the  manufacturers  of  cotton  goods 
at  the  north  are  identified  with  the  interest  of  the  grower  of  cottoh 
at  the  south,  and  that,  as  strength  is  added  to  these  two  great  inter- 
ests, the  one  at  the  north  and  the  other  at  the  south,  so  will  strength 
be  added  to  the  bands  which  bind  this  glorious  Union  together." 

It  is  not  to  be  supposed,  with  all  the  natural  advantages  for  man- 
ufacturing which  the  south  possesses,  especially  Georgia,  that  she 
will  be  long  without  being  prepared  to  manufacture  her  own  great 
staple,  cotton,  in  the  regions  of  its  growth.  She  has  already  begun 
the  work,  and  is  advancing.  Such  a  system  will  be  an  incalculable 
saving  and  gain  to  the  south.  But  whether  manufacturing  is  done 
there,  or  at  the  north,  the  south  is  benefited ;  but  she  will  be  more 
benefited  when  it  is  done  at  home,  for  the  same  reason  that  it  is 
better  to  do  it  in  the  United  States  than  to  have  it  done  abroad. 


502  PRINCIPLES,    OBJECTS, 


CHAPTER   XXXI. 

THE    PRINCIPLES    OF    A    TARIFF    AS     THEY     RESPECT     THE     OB- 
JECTS OF  DUTIES  AND    THE    MODES  OF    COLLECTING  THEM. 

An  American  Eoonomist  of  the  present  Time  exposed  to  the  Charge  of  Political  Partisan- 
ship.— He  is  obliged  to  examine  public  Measures  as  Facts — The  Prinoiples  of  the 
"Revenue  Standard"  examined — A  Tariff  not  a  Revenue  Measure,  except  inciden- 
tally.— The  Cu8tomhou.-e  System  inconsistent  with  Free  Trade. — Diject  Taxation  and 
Free  Trade  go  together — No  such  Thiiii,'  as  Incidental  Piotec  ion. — Minimum  Duties 
and  their  Effects. — Specific  Duties — Ad  Valorem  Duties. — History  and  Effects  of  these 
Different  Modes  of  Duties. — Proofs  in  Point. 

We  are  compelled,  in  many  parts  of  our  argument,  to  run  the 
risk  of  being  called  a  political  partisan,  though  we  have  no  interest 
in  anything  but  truth.  It  is  evident  enough  that  public  econ- 
omy can  not  be  separated  from  politics,  when  its  very  purpose 
is  to  establish  a  creed  for  statesmen.  There  is  not  a  question  that 
falls  within  its  range  that  is  not  a  question  of  state.  It  is  also  more 
pertinent  to  our  argument,  and  more  forcible,  to  notice  things  done, 
than  to  suppose  things  done  ;  and  the  more  recent  they  are,  so 
much  better  are  they  known  to  all.  The  reader  of  the  Free-Trade 
economists  will  always  find  li tj'potheses  of  facts  as  the  instrument 
and  ground  of  reasoning,  which  are  framed  to  suit  their  purposes; 
but  rarely  does  he  meet  with  facts  in  those  authorities  as  the  basis 
of  a  theory.  On  the  contrary,  we  resort  to  facts  as  the  only  ground 
of  reliable  deduction.  Hence  we  are  often  forced  into  the  midst 
of  political  events  and  agitations.  Some  of  the  more  recent  parts  of 
the  political  history  of  the  United  States  furnish  facts  for  the  econ- 
omist, which  it  is  impossible  to  overlook  ;  or  which,  being  over- 
looked, would  be  a  great  defect  in  his  work.  The  questions  which 
we  have  in  hand  imperatively  demand,  among  other  things,  that 
we  should  review  the  measures  and  examine  the  doctrines  of  the 
administration  which  commenced  its  career  on  the  4th  of  March, 
1845,  so  far  as  they  relate  to  a  protective  system.  In  doing  this,  it 
becomes  necessary  to  notice  their  official  documents,  and  some  of 
the  acts  passed  at  their  recommendation,  as  we  have  several  times 
done,  but  which  we  are  obliged  to  do  more  at  large  in  this  chaptei 
and  the  next  following.  The  tangible  points  which  they  present, 
and  the  facts  with  which  they  are  connected,  antecedent  and  sub- 


AND  Modes  of  a  tariff.  603 

sequent,  relating  to  a  protective  systenfi,  which,  as  opposed  to  Free 
Trade,  is  the  leading  and  main  topic  of  this  work,  present  them- 
selves in  the  foreground  of  that  wide  field  which  is  the  subject  of 
our  investigation. 

And  here  it  is  pertinent  to  remark,  that,  as  matters  go  on,  in 
the  administration  of  the  government  of  the  United  States,  the  ut- 
terances of  the  secretary  of  the  treasury,  in  his  report  on  the 
finances,  are  of  course  to  be  regarded  as  the  echoes  of  the  mind 
and  will  of  the  president  ;  though,  by  the  constitution  and  laws, 
the  secretary  is  an  agent  of  Congress,  accountable  to  that  body 
alone,  should  act  in  harmony  with  his  legitimate  masters,  and" in 
obedience  to  their  instructions.  This  incongruity  was  establislied 
in  1833,  when  the  president  took  charge  of  the  treasury.  As  the 
report  of  the  secretary  of  the  treasury,  of  December  3,  1845,  was 
made  the  basis  of  the  tariff  of  1846,  in  accordance  with  the  views 
of  the  president  (it  is  an  echo  of  the  message),  an  examination  of 
the  principles  of  the  report  will  determine  those  of  the  new  law. 

We  proceed  to  consider  what  is  called  the  '■'■  revenue  standard,^'' 
in  the  formation  of  a  tariff.      The  secretary  of  the  treasury  of  the 
United  States,  in  his  annual  communication  to  Congress,  Decem- 
ber 3,  1845,  seems  to  have  made  a  discovery,  to  wit,  that  imposts 
laid  for  any  other  purpose  than  revenue  are  unconstitutional.     He 
says  :   "  The  whole  power  to  collect  taxes,  whether  direct  or  indi- 
rect, is  conferred  by  the  same  clause  of  the  constitution.     The 
words  are  :  '  The  Congress  shall  have  power  to  lay  and  collect 
taxes,  duties,  imposts,  and  excises.'  "    Assuming,  first,  that  "  taxes" 
are  identical  with  "  duties  and  imposts  ;"   next,  that  all  duties  are 
taxes  ;  thirdly,  that  protective  duties  are  either  partially  or  entirely 
prohibitory  ;  fourthly,  that  power  is  identical  with   duty,  that  is,  a 
"  power  to  collect"  means  shall  collect ;  and  fifthly,  that  a  tariff 
of  duties  on  imports  is  a  mode  of  taxation   for  revenue  inescribed 
by  the  constitution;  —  with  such  a  string  of  assumptions,  the  sec- 
retary arrives,  with  self-plumed  honors  on,  to  the  logical  achieve- 
ment that  protective  duties  are  unconstitutional.     First,  because 
protection  is  not  authorized  by  that  instrument.     Next,  because,  if 
it  were,  when   the  duty  amounts  to  prohibition,  as  it  sometimes 
does,  the  duty  can  not  be  collected ;  or  to  a  partial  prohibition,  as 
at  least  it  must,  a  iiart  of  it  can  not  be  collected.     Hence,  none 
but  duties  imposed  expressly  and  only  for  revenue  can  be  consti- 
tutional. 

Unfortunately  for  the  secretary,  the  first  of  the  above-named  as- 


504  PRINCIPLES,    OBJECTS, 

sumptions  requires  proof,  and  is  open  to  disproof;  the  second  is 
disproved  ;  tlie  third  is  of  no  consequence ;  the  fourth  is  an  ab- 
surdity ;   and  the  fifth  also  requires  proof. 

To  assume  that  "  duties  and  imposts"  are  identical  with  "  taxes," 
or  that  the  same  thing  is  meant  by  the  former  as  by  the  latter, 
amounts  to  an  accusation  of  superfluity  of  language  in  the  consti- 
tution, made  for  and  held  to  be  a  concise  and  comprehensive  doc- 
ument. The  constitution  manifestly  names  "  duties  and  imposts" 
as  a  different  sort  of  thing  from  "  taxes"  —  as  occupying  their  own 
peculiar  position,  and  as  discharging  their  own  appropriate  func- 
tions, as  in  fact  they  do,  in  public  economy.  They  may  be  taxes  ; 
they  may  not  be  ;  they  certainly  are  not  always.  It  has  been 
proved  that  protective  duties  are  rarely  taxes  —  never  as  a  whole  ; 
and  that,  as  a  system,  they  operate  quite  the  other  way.  If  it  be 
asked,  "  Why,  then,  are  the  two  words,  '  duties  and  imposts,'  used 
here?"  —  the  answer  is,  because  they  do  not  always  mean  the 
same  thing.  Though  duties  are  imposts,  prohibitory  imposts  are 
not  duties,  in  the  strict  meaning  of  terms,  because,  in  such  a  case, 
there  being  no  entries,  there  can  be  no  duties  to  discharge. 

The  second  assumption  is  answered  by  the  evidence  in  a  former 
chapter,  that  protective  duties  are  not  taxes.  The  third  is  granted, 
but  is  of  no  consequence,  while  the  others  fail.  It  need  not  be 
said,  that  the  fourth  is  a  manifest  absurdity.  As  to  the  fifth,  it 
may  be  remarked  that  a  iar'iff  is  not  j^rescribed  in  the  constitution  as 
a  mode  of  raising  revenue  ;  next,  that  the  design  of  a  tariff,  in  all 
nations,  and  in  all  cases,  is  to  regulate  foreign  commerce  so  as  to 
protect  the  interests  of  the  state  and  of  the  people  in  foreign  trade; 
thirdly,  and  consequently,  that  the  revenue  functions  of  a  tariff  are 
incidental,  not  primary,  or  necessarily  inherent.  If,  in  accomplish- 
ing the  original  and  main  design  of  a  tariff,  revenue  can  be  raised, 
it  is  well ;  but  it  is  incidental.  If  a  sufficient  revenue  can  be  raised, 
and  direct  taxation  avoided,  so  much  the  better.  Still,  this  inci- 
dental result  does  not  change  the  original  design  and  character  of 
the  measure.  No  one  will  pretend  that  drawbacks  and  bounties 
are  any  part  of  a  revenue  measure,  though  they  may  be  a  very  im- 
portant part  of  a  tariff.  The  whole  of  the  secretary's  argument  on 
this  point,  therefore,  is  a  total  failure. 

This  erroneous  idea,  that  a  tariff  is  a  revenue  measure,  except 
incidentally,  is  of  some  importance  to  be  corrected,  not  simply  in 
answer  to  the  secretary's  reasoning,  who  seems  never  to  have 
thought  of  the  original  and  true  design  of  a  tariff;  but  for  the  sake 


AND    MODES    OF    A    TARIFF.  505 

of  showing  what  that  design  is.  This  is  the  first  time,  in  the  his- 
tory of  tariffs,  that  an  attempt  has  been  made  to  prove  a  tariff  a 
revenue  measure,  in  the  theory  of  law  and  the  constitution.  In  do- 
ing that,  the  honest  way  would  be  to  drop  the  name,  which  has  ever 
been  held  to  signify  a  different  thing,  and  which  was  devised  for  a 
different  purpose.  Honesty,  indeed,  would  require  more  than  this. 
For,  if  all  the  original  and  long-condnued  objects  of  a  tariff  are  to 
be  abandoned  ;  and  if  it  be  indeed  true,  as  Free  Trade  asserts,  that 
all  duties  are  taxes  up  to  their  specific  amount,  it  is  a  very  great 
injustice  to  the  people  to  add  to  these  taxes  the  immense  tax  of 
the  customhouse  system,  by  sustaining  all  its  machinery  and  offices. 
If  the  doctrines  of  Free  Trade  be  true,  every  customhouse  in  the 
land  should  be  closed  as  soon  as  possible,  and  the  system  should 
be  forthwith  abandoned.  It  is  a  very  expensive  system,  if  there 
is  no  power  in  it — as  the  protective  policy  avers  there  is  —  to  sus- 
tain itself  According  to  the  theory  of  Free  Trade,  the  people 
ought  to  be  relieved  from  this  burden,  and  a  system  of  direct  taxa- 
tion, to  support  the  government,  and  supply  its  wants,  ought  to  be 
substituted.  If  the  people  can  have  an  intelligent  belief  in  Free 
Trade,  it  is  impossible  they  should  not  also  see  that  it  will  be  much 
lighter,  and  much  more  just  to  all  parties,  for  every  one  to  be 
fairly  assessed  on  his  property  for  all  the  requirements  of  the  pub- 
lic treasury.  The  chief  burden  of  supporting  the  government 
would  then  fall  where  it  ought  —  on  the  rich.  There  can  be  no 
apology,  according  to  the  doctrines  of  Free  Trade,  for  continuing 
a  tariff,  as  a  mere  revenue  measure  ;  for  no  system  of  taxation 
could  be  more  unjust  in  itself,  besides  the  injustice  of  imposing  on 
the  people  the  superfluous,  heavy,  and  oppressive  expenses  of  the 
customhouse  system. 

But  it  has  been  proved  in  this  work,  over  and  again,  in  a  variety 
of  forms,  that  protective  duties  are  not  taxes  ;  and  that,  if  properly 
adjusted,  they  will  not  only  support  the  government,  in  a  time  of 
peace,  and  defray  all  the  expenses  of  the  customhouse  system, 
which  is  a  part  of  government ;  but  that  it  will  rescue  us  from  a 
grievous  system  of  foreign  taxation  ;  be  of  incalculable  benefit  to  all 
sections  and  to  all  parties,  rich  and  poor,  of  the  country  ;  sustain 
the  currency  and  make  it  abundant;  give  employment  and  good 
wages  to  all  kinds  of  labor  ;  and  contribute  to  the  wealth  of  the 
nation,  in  a  manner  and  degree  that  can  not  be  easily  estimated  : 
while  Free  Trade,  as  all  our  experience,  also  abundantly  cited  in 
this  work,  proves,  would  produce  directly  the  contrary  effects  in 


506  PRINCIPLES,    OBJECTS, 

all  these  particulars.  The  original  and  legitimate  object  of  a  tariff, 
especially  in  the  United  States,  is  "  to  regulate  commerce  with 
foreio-n  nations"  —  an  express  authority  of  the  constitution  —  so  as 
best  to  secure  the  interests  of  the  country  and  of  the  people,  as 
above  specified  —  especially  the  interests  of  labor,  which  is  the  soul 
and  body  of  all  wealth  ;  whereas,  the  object  of  obtaining  revenue 
by  a  tariff  was  originally,  has  ever  been  till  now,  secondary  and 
purely  incidental.  If  the  protective  principle  is  to  be  abandoned, 
it  is  obvious  that  the  only  honest  course  is  to  abandon  with  it,  alto- 
gether, the  customhouse  system.  Without  protection,  it  is  a  use- 
less expense,  and  a  heavy  additional  tax. 

Nothing  could  exceed  the  confusion  and  derangement  which  the 
princi|)le  of  this  "revenue-standard"  theory,  reduced  to  practice, 
would  occasion  to  the  interests  and  business  of  the  country,  because 
that  rate  of  duty  on  a  specific  article  which  would  raise  the  most 
revenue,  when  imposed,  would,  almost  invariably,  by  its  operation, 
require  to  be  changed  every  year  —  often  every  six  months  —  to 
accomplish  the  same  object.  It  would,  indeed,  if  carried  thoroughly 
into  execution,  in  a  very  short  time,  most  seriously  derange,  if  not 
break  up  a  vast  many  of  the  most  important  interests  of  die  country, 
besides  the  injurious  effects  it  must  have  on  all  others,  by  an  indis- 
soluble connexion  and  sympathy. 

A  common  error,  both  of  the  secretary  and  of  the  president,  in 
carrying  out  their  "revenue-standard"  theory,  seems  to  have  been 
in  assuming,  that  every  duty  on  articles  of  desired  home  production, 
is  protection.  This  is  an  important  practical  error,  and  has  given 
rise  to  the  false  notion  of  "  incidental  protection,"  when,  in  fact, 
there  can  be  no  such  thing  as  vitcidental,  that  is  not  j'ositive,  protec- 
tion. On  this  point,  the  president  says,  in  his  message  of  Dec.  2, 
1845:  "  If  Congress  levy  a  duty  for  revenue,  of  one  per  cent.,  on 
a  given  article,  it  will  produce  a  given  amount  of  money  to  the 
treasury,  and  will  incidentalhj  and  iiecessarily  afford  protection  or 
advantage  to  the  amount  of  one  per  cent.,  to  the  home  manufacturer 
of  a  similar  or  like  article,  over  the  importer."  The  entire  fallacy 
of  this  doctrine  of  "  incidental  protection"  will  be  seen  at  once, 
when  it  is  considered  that  the  ability  of  the  home-producer  to  begin 
and  to  sustain  himself  against  foreign  competition,  depends  alto- 
gether on  his  having  adequate  and  jwsitive  protection,  which  is 
rarely,  if  ever,  as  low  as  one  per  cent. ;  may  be  five,  or  twenty,  or 
fifty,  or  one  hundred,  or  two  hundred  per  cent.  But  he  can  never 
begin,  and  can  never  sustain  himself,  till  he  has  a  positive  protec- 


AND   MODES    OF    A    TARIFF.  507 

tion,  equal  to  the  ability  of  the  foreign  producer  to  undersell  him  in 
his  own  market.  This  idea,  therefore,  of  "  i7icidental  protection," 
is  a  perfect  fallacy  —  a  positive  decejUion.  There  never  was  — 
there  never  can  be  any  such  thing,  measured  out  in  the  way  the 
president  proposes,  as  if  it  could  be  effective  for  the  degree  speci- 
fied, when  it  fails  to  be  adequate.  And  yet  —  strange  to  say  —  this 
phantom  is  the  only  basis  on  which  the  president  and  secretary 
build  their  scheme  of  protection  for  the  people.  It  is  the  only 
protection  that  is  proffered  to  their  hopes  in  the  tariff  of  1S46. 
The  Pennsylvanians  are  favored  with  an  ^^  incidental  protection," 
not  of  one,  but  of  thirty  per  cent.,  on  iron  and  coal.  Is  that  pro- 
tection ?  So  of  a  vast  many  interests  of  the  country  —  an  "inci- 
dental protection"  to  their  ruin.     Just  enough  to  miss  it. 

The  rule  of  minimum  duties  is,  that  a  given  kind  of  goods,  or 
merchandise,  valued  at  or  below  a  given  price,  shall  be  assessed 
with  a  specific  duty  at  that  price  ;  as  for  example  :  "  Manufactures 
of  cotton,  not  dyed,  colored,  printed,  or  stained,  not  exceeding  in 
value  20  cents  per  square  yard,  shall  be  valued  at  20  cents  per 
square  yard,"  for  the  assessment  of  an  ad-valorem  duty  of  30  per 
cent.,  as  under  the  tariff  of  1842. 

There  has  been  a  most  inexcusable  ignorance  or  dishonesty,  in 
the  reasonings  of  the  advocates  of  Free  Trade,  on  the  effect  of 
minimum  duties.  With  some,  it  seems  to  have  been  ignorance; 
and  charity  would  lead  us  to  suppose  it  has  been  so  with  most. 
The  secretary  of  the  treasury,  in  his  annual  report  of  December, 
1845,  says  :  "  If  any  discrimination  should  be  made,  it  should  be 
the  reverse  of  the  minimum  principle,  by  establishing  a  maximum 
standard,  above  which  value  the  duties  on  the  finer  article  should 
be  higher,  and  below  which  they  should  be  lower  on  the  cheaper 
article."  He  argues  that  by  the  minimum  rule,  the  rich  are  favored 
at  the  expense  of  the  poor ;  or  that  there  is  a  partiality  in  favor  of 
the  former,  and  against  the  latter ;  and  at  first  sight,  as  an  ad-cap- 
tandvm  argument,  it  would  seem  plausible.  But  it  is  demolished 
by  proof  of  the  fact  that  these  protected  articles  of  manufacture  are 
cheapened  by  protection.  The  secretary,  through  either  ignorance 
or  design,  fails  to  consider  how  this  minimum  rule  operates  on 
prices  of  the  articles,  in  consideration  of  the  different  state  of  the 
manufacturing  arts  in  this  country  and  in  Europe,  when  the  rule 
was  established,  and  that  as  soon  as  the  minimum  duty  becomes 
prohibitory,  the  consumer  here  is  rescued  from  a  system  of  foreign 
taxation,  and  has  all  the  benefit  of  a  vigorous  home  competition, 


508  PRINCIPLES,    OBJECTS, 

that  gives  him  these  articles,  which  are  covered  by  the  minimum 
duties,  cheaper  than  he  could  have  got  them  from  abroad,  if  the 
home  producer  had  not  been  encouraged  to  provide  them  by  pro- 
tection. It  is  on  the  lower  degrees  of  the  scale  of  prices,  that 
American  arts,  under  adequate  protection,  first  overtake  and  out- 
strip the  European  arts;  and  the  system  of  minimum  duties,  grad- 
ually ascending  the  scale,  enables  American  arts  to  rise  whh  them, 
and  as  fast  as  they  rise,  in  perfection  and  vigor,  they  cheapen 
prices ;  so  that  the  poorer  classes  have  the  first  and  largest  benefit 
of  this  influence  ;  and  they  have  it  chiefly  because  and  when  the 
minimum  duties  become  prohibitory. 

There  is  a  most  inexcusable  statement  in  the  same  report  of  the 
secretary  on  this  subject,  which  is  the  more  important,  as  it  consti- 
tutes one  of  the  chief  elements  of  his  reasoning,  and  that  of  others 
of  his  school.  In  the  same  manner  as  British  factors  were  intro- 
duced into  a  committee-room  of  Congress,  in  the  winter  of  1845-6, 
and  invited  to  display  their  goods,  in  order  to  show  how  much  bet- 
ter it  would  be  for  the  American  people  to  buy  than  to  make  thera, 
so  Mr.  M'Kay,  chairman  of  the  committee  of  ways  and  means, 
in  framing  his  report  (house  document.  No.  306,  1st  session,  28th 
Congress),  thought  proper  to  fortify  one  of  his  positions  by  citing 
a  price  current  published  in  Manchester,  England,  by  Stewart, 
Thompson,  and  Lay,  January  31,  1843.  The  price  of  "stouts 
or  domestics,"  an  imitation  of  a  species  of  American  cotton  goods, 
was  there  given,  with  the  additional  statement,  that  they  had  to 
pay  100  per  cent,  duty  in  entering  the  United  States,  under  the 
minimum  rule.  The  secretary  of  the  treasury,  eagerly  catching 
at  this  information  found  in  Mr.  M'Kay's  report  of  the  preceding 
Congress,  as  it  suited  his  purpose,  and  taking  for  granted  that  these 
goods  were  actually  imported  under  that  duty,  made  the  following 
statement:  "  This  difference  is  founded  on  actual  imforiation,  and 
shows  an  average  discrimination  against  the  poor,  on  cotton  imports, 
of  82  per  cent,  beyond  what  the  tax  would  be,  if  assessed  upon 
the  actual  value."  The  secretary  hastily  —  it  is  presumed  not 
reluctantly  —  adopted  the  conclusion,  that  trade  was  then  going 
on  in  that  way  ;  whereas,  this  very  species  of  goods  was  actually 
selling  lower  in  Boston  and  New  York,  at  the  time  this  Manchester 
price  current  was  published,  than  the  prices  there  quoted  for  the 
English  market.  It  was  because  the  minimum  duty  was  prohibi- 
tory, and  gave  the  widest  scope  for  home  competition. 

It  is  very  well  known  to  those  who  understand  the  subject,  and 


AND    MODES  OF    A    TARIFF.  509 

who  are  acquainted  with  the  facts,  that  the  effect  of  minimum 
duties,  is  to  lower  the  prices  of  low-priced  goods,  chiefly  used  by 
the  poor,  and  to  pull  down  prices  at  higher  points  of  the  scale,  in 
proportion  as  American  manufacturing  skill  improves.  And  yet, 
the  secretary  has  made  a  bugbear  of  minim ums,  to  frighten  the 
poor.  Did  he  himself  understand  the  subject?  If  so,  he  is  open 
to  a  more  grave  impeachment  than  that  of  ignorance. 

It  is  on  this  false  principle,  and  false  statement  of  facts  —  of 
which  it  is  charitably  supposed  the  secretary  was  ignorant — that  he 
arrives  at  the  following  false  conclusions,  first,  grnerally,  that 
"  niinimums  and  specific  duties  render  the  tax  [which  is  no  tax  at 
all]  upon  the  real  value  much  higher  upon  the  cheajier  than  upon 
ihe  Jiner  article;"  secondly,  and  spccijically,  that,  "  by  estimates 
founded  on  the  sawe  document  [Mr.  M'Kay's  report],  the  discrimi- 
nations against  the  cheaper  article  [under  the  tariff  of  1842]  must 
amount  to  a  tax  of  $5,108,422,  exacted  by  minimums  and  specific 
duties  annuallij  from  the  poorer  classes."  And  yet,  as  a  matter 
of  fact,  the  true  proposition  on  the  point,  is,  in  both  particulars, 
directly  the  reverse  of  this.  Is  it  possible  the  secretary  should  have 
been  ignorant  in  this  case  ?* 

•  Minimum  duties  were  first  introduced  bj'  southern  statesmen,  Messrs.  Cal- 
houn and  Lowndes,  in  the  tariff  of  J816.  It  will  be  found,  by  an  examination  of 
senate  document,  No.  109,  second  session,  28th  Congress  (a  document  from  the 
secretary  of  the  treasury),  that  the  application  of  the  minimum  principle  to  wool- 
lens, puts  the  tax  (if  indeed  it  were  one,  but  it  is  not)  on  the  costly  goods  worn  by 
the  rich,  and  is  all  in  favor  of  the  cheaper  goods  worn  by  the  poor.  The  annual 
revenue  from  this  source,  under  the  tariff  of  J842  (see  same  document),  was  over 
two  millions  of  dollars.  By  the  same  authority,  it  appears  that  the  application  of 
the  minimum  principle  to  cottons  yielded  annually  to  the  revenue,  under  the  tariff 
of  1842,  upward  of  four  millions  of  dollars,  the  chief  burden  of  which  (if  burden 
it  was,  but  it  was  not)  falls  on  the  finer  goods  worn  by  the  rich.  Even  these 
are  cheapened,  such  of  them  as  are  rivalled  at  home  by  the  action  of  domestic 
against  foreign  competition;  and  those  not  rivalled  at  home  are  the  finest  and 
most  costly,  not  used  except  by  those  who  indulge  in  luxuries.  That  the  low- 
priced  cotton  goods  are  greatly  cheapened,  is  not  only  proved  by  the  prices  cur- 
rent, but  is  demonstrated  beyond  all  contradiction  by  the  facts  that  they  go  forth 
into  the  widest  field  of  competition,  in  all  parts  of  the  world,  with  British  goods 
of  the  same  description,  and  that  the  British  government  was  forced  to  enact  dif- 
ferential duties  for  their  dependencies,  in  favor  of  British  products,  to  keep  out 
American. 

The  revenue  raised  in  one  year,  under  the  tariff  of  1842,  by  the  application  of 
the  minimum  principle,  on  cotton  goods,  as  stated  in  the  abovenamed  document, 
was  as  follows :  $1,121,000  from  goods  costing  above  the  minimum,  at  a  duty  of 
30  per  cent. ;  $2,574,000  from  printed  and  colored  goods,  at  9  cents  square  yard, 
or 43  per  cent,  duty;  $544,000  from  plain  goods,  at  6  cents  square  yard,  or  Ab\ 
per  cent,  duty ;  and  $34,000  from  velvets,  &,c.,  at  10^  cents  square  yard,  or  35  per 


510  PRINCIPLES,    OBJECTS, 

A  s'pecijlc  duty  is  assessed  by  measure,  as  so  much  per  yard, 
per  gallon,  per  cwt.,  per  caldron,  &c.,  the  instrument  of  measure 
being  such  as  the  nature  of  the  article  requires.  An  od-vdlorvm 
dutij  is  assumed  to  be  an  assessment  nccording  to  the  value  of  the 
article,  and  the  rule  of  valuation  is  the  foreign  invoice,  with  legal 
provisions  to  guard  against  fraud.  Of  what  effect  these  provisions 
are,  will  be  seen  by-and-hy.  Specific  duties  are  not  imposed  with- 
out regard  to  value  ;  but  it  is  obvious,  that  this  rule  applied  to  any 
article  which  has  a  wide  range  of  values  for  a  given  measure,  as 
cloths,  wines,  tea,  coffee,  &c.,  must  operate  with  inequality,  when 
this  term  is  not  used  in  the  sense  of  injustice,  which  could  not 
easily  be  proved  in  such  a  case,  as  it  is  rather  a  quesiion  of  discre- 
tion and  expediency  than  of  right  and  wrong.  One  of  the  objects 
of  specific  duties  is  to  abate  this  inequality,  and  come  nearer  to  the 
real  values.  The  ad-valorenj  mode  is  also  attended  with  its  dif- 
ficulties, especially  when,  as  in  tlie  case  of  the  American  law,  the 
rule  of  valuation  is  the  foreign  invoice,  the  temptations  to  fraud 
being  so  strong,  and  its  means  so  easily  employed,  with  great 
chances,  usually  with  a  certainty,  of  impunity.  The  experience 
of  all  governments,  down  to  this  time,  has  decided  in  favor  of  the 
specific  mode,  as  being  on  the  whole  most  convenient,  most  secure 
of  the  ends  aimed  at,  and  especially  as  being  a  preventive  of  im- 
morality and  crime.  But  notwithstanding  these  reasons  of  expe- 
rience, the  new  American  tariff  of  1846,  on  the  recommendation 
of  the  president,  was  constructed  on  the  ad-valorem  principle,  re- 
cent, duty  ;  in  all,  $4,273,000,  with  an  average  duty  of  38  per  cent.  If  this  min- 
imum duly  were  a  tax,  it  must  be  seen  how  it  falls  chiefly  on  those  who  bought  Ihe 
high-priced  goods ;  and  that  the  small  amount  collected  on  the  low-priced  goods 
was  not  a  tax,  is  evident,  as  well  from  the  positive  reduction  of  prices,  as  from  the 
fact  that  they  are  sold  against  the  same  description  of  British  goods  in  all  parts  of 
the  world.  But  it  has  been  shown  elsewhere,  that  none  of  these  duties,  imposed 
for  protection,  are  taxes. 

But  one  of  the  most  stupendous  effects  of  the  application  of  the  minimum  prin- 
ciple of  duty,  is  the  opening  of  a  vast  market  for  American  cotton  fabrics — of 
course  for  the  raw  material — in  eastern  Asia,  whence  the  same  kind  of  goods  for- 
merly came  to  Europe  and  America.  The  cheap  labor  of  China  and  ihe  far  east, 
has  been  undersold  by  the  high-priced  labor  of  America,  in  the  application  of  su- 
perior skill  and  economy  of  production,  and  a  channel  for  an  annual  export  of 
some  millions,  from  the  United  States,  has  been  opened  by  this  course,  destined  to 
increiise,  almost  without  limit,  under  the  same  system. 

South  Carolina,  in  establishing  Ihe  cotton  minimums  of  1816,  laid  the  foundation 
for  this  turning  back  upon  Asia  the  most  essential  production  of  the  Southern 
states.  It  is  among  the  strangest  things  of  things  strange,_that  this  immense  mis- 
take, this  fatal  blunder,  above  considered  in  the  text,  should  have  been  made  by 
the  very  parties  so  vitally  injured  by  it. 


AND    MODES    OF    A    TARIFF.  511 

jecting  the  specific.     It  is  proposed  to  examine  these  two  modes. 
See  note.* 

*  If  one  could  not  be  surprised,  in  the  midst  of  so  many  new  things,  one  might 
yet  be  so,  in  view  of  a  reason  given  by  the  secretary  of  the  treasury  for  the  adop- 
tion of  ad-valorem  as  a  substitute  for  specific  duties.  He  says  :  '*  Experience 
proves,  that,  as  a  general  rule,  a  duty  of  20  per  cent,  ad  valorem  will  yield  the 
largest  revenue."  Now,  it  happens,  that  all  experience  leads  to  the  opposite  con- 
clusion, and  that  statesmen,  heretofore,  in  all  countries,  wishing  to  raise  the  lareest 
revenue,  by  imposts,  have  preferred  the  form  of  specifics.  Great  Britain  has  had, 
and  still  has,  occasion  for  the  highest  possible  revenue  on  certain  articles,  and  she 
invariably,  when  it  is  practicable,  havine  that  object  in  view,  adopts  the  specific 
form,  as  on  teas,  the  duties  on  which  are  at  least  200  per  cent.,  and  produced,  in 
1842,  upward  of  $19,000,000.  Her  duty  on  sugar,  for  the  same  year,  specific, 
produced  upward  of  $24,500,000.  The  subsequent  reduction  of  duty  on  sugar, 
was  fur  relief,  not  for  revenue.  Her  duties  on  wines  and  tobacco  are  spt  cific,  va- 
rying from  300  to  900  per  cent.,  and  produce  a  revenue  of  about  $40,000,000.  It 
is  unnecessary  to  go  farther  for  the  exjierience  of  England.  Our  revenue  for  the 
year  1831,  under  the  hish  tariff  of  1828,  the  duties  having  been  made  specific,  as 
far  as  possible,  was  $30,312,8.51  net,  at  rates  of  duty  averaging  41  per  cent,  on 
dutiable  articles.  Our  lowest  tariff  was  in  the  last  year  of  the  compromise,  1842, 
with  an  average  duty  of  less  than  24  per  cent.  —  commonly  supposed  to  be  20  — 
on  dutiable  imports,  and  the  net  revenue  for  the  year  was  $12,780,173.  Is  it  such 
experience  which  the  secretary  appeals  to?  Or  where  is  it?  Mr.  Poik  said,  in  a 
speech  at  Madison,  Tennessee,  in  1843,  while  canvassing  for  the  office  of  gov- 
ernor: "  It  [the  tariff  of  1842]  will  not  produce  annually  half  the  amount  of  reve- 
nue which  would  have  been  produced  by  the  lower  rates  of  the  compromise  act ;" 
that  is,  by  the  tariff  that  was  in  operation  when  that  of  1842  went  into  effect. 
This  less  than  half,  as  will  be  seen,  would  have  been  less  than  $6,390,036  annual 
revenue  for  the  tariff  of  1842.  But  it  actually  produced  an  average  of  over 
$26,000,000  net.  Was  this  the  experience  on  which  the  secretary  came  to  his  con- 
clusion ?  Twenty  per  cent,  was  the  commonly  alleged  maximum,  at  the  time,  which 
produced  a  revenue  of  twelve  millions  and  a  half. 

The  experience  of  our  own,  and  of  other  governments,  has,  from  the  beginning, 
prompted  the  greatest  possible  pains  to  apply  specific  duties  wherever  practicable 
in  the  nature  of  the  article;  and  in  accordance  with  this  experience,  the  list  of 
specific  duties  had  been  increased,  and  that  of  ad-valoreins  diminished,  in  all  these 
quarters,  at  every  new  modification  of  the  tariff,  almost  from  time  immemorial. 
England  has  always  been  aiming  at  this;  many  of  the  continental  tariffs,  the  fa- 
mous ZoU-Verein  in  particular,  are  wholly  specific.  Mr.  Gallatin,  when  at  the 
head  of  the  treasury,  earnestly  recommended  more  specific  duties;  so  Mr.  Dallas 
(Alexander  J.) ;  so  Mr.  Crawford;  and  under  each  of  these  secretaries,  as  well  as 
under  others,  much  had  been  done  to  accomplish  the  end  —  chiefly,  indeed,  to  pre- 
vent frauds  on  the  revenue,  at  the  same  time  that  specific  duties  have  always  been 
regarded  as  the  best  mode  of  increasing  the  revenue,  if  required. 

But,  though  the  amount  of  revenue  can  not  be  a  trifling  consideration,  at  a  time 
when  the  public  expenditures  are  running  up  to  between  fifty  and  a  hundred  mill- 
ions a  year,  yet  the  universal  experience  of  frequent  and  great  frauds,  under  a 
system  of  ad-valorem  duties  —  frauds  on  the  revenue,  and  frauds  on  American  cit- 
izens and  interests  —  presents  considerations,  which  ought  to  bring  every  good  man 
to  a  pause,  before  he  should  consent  to  open  such  a  door  to  immorality  and  crime 
—  to  legalize  fraud,  and  oflTer  the  most  seductive  advantages  to  perjury.  What 
does  a  European  factor  of  merchandise  care  for  a  customhouse  oath,  who  has  been 
bred  in  a  school  which  teaches,  that  the  evasions  of  imposts,  by  whatever  means, 


512  PRINCIPLES,    OBJECTS, 

As  the  modes  of  assessing  duties  had  never  been  made  a  party 
question  in  the  United   States,  one   can    hardly   account  for  this 

is  equally  a  virtue  and  a  duty,  and  who  will  glory  in  it,  when  beyond  the  reach  of 
punishment?  Such,  notoriously,  is  the  state  of  morals  in  Europe,  on  this  subject. 
The  writer  of  these  pages  has  seen  and  heard  it  there,  as  openly  proclaimed  and 
boasted  of,  as  the  proudest  achievements.  Nor  is  this  the  worst  of  it.  Custom- 
house officers  can  be  bribed,  as  abundant  experience  demonstrates.  The  tempta- 
tion to  share  in  the  spoils  —  and  such  spoils  —  is  equally  great  to  them,  as  to  foreign 
factors,  who,  for  the  consideration  they  expect  to  realize,  have  been  judicially 
proved  to  have  sworn  in  their  false  invoices,  with  as  much  indifference  as  if  they 
were  making  a  fair  trade.  It  puts  the  government,  the  people,  and  the  interests 
of  the  country,  on  a  stupendous  scale,  in  the  power  of  unprincipled  villains  of  the 
blackest  character. 

A  report  of  the  secretary  of  the  treasury,  1843  (Senate  Doc.  No.  83,  3d  session, 
27th  Congress),  is  replete  with  melancholy  instruction  on  this  subject,  showing,  by 
the  action  of  the  United  States  court,  in  the  investigation  of  such  cases,  that  frauds 
and  perjuries,  for  a  term  of  years,  under  ad-valorem  duties,  were  habitually  and 
systematically  committed  by  foreign  factors,  with  connivance  of  customhouse  offi- 
cers, involving  great  amounts  of  value;  and  as  but  one  crime  in  many  is  usually 
detected,  the  inference  is  fair,  that,  aggravated  and  great  as  these  frauds  were,  as 
proved  in  court,  they  comprehended  but  a  small  fraction  of  those  which  were  suc- 
cessfully carried  on,  simultaneously  with  these,  and  escaped  punishment.  In  the 
case  of  one  British  importer,  "John  Taylor,  jr.,"  aided  by  a  deputy  collector  of 
New  York,  whose  name  is  given  as  "  Campbell,"  the  frauds  committed,  in  the 
course  of  twenty-one  months,  amounted  to  $200,000.  This  was  but  one  of  many 
cases  brought  before  the  court,  and  each  of  the  many  was  doubtless  but  one  of 
many  more  that  escaped  exposure.  Such  is  the  system  of  duties  adopted  by  the 
tariff  of  1846,  and  such,  inevitably,  must  be  the  consequences,  in  this  country,  or 
any  other,  while  man  remains  the  same.  It  was  to  avoid  these  crimes,  as  far  as 
possible,  that  great  pains  have  been  taken,  fur  generations,  by  all  governments,  to 
substitute  specific  for  ad-valorem  duties,  without  regard  to  the  amount  of  revenue 
—  though  it  appears,  that  specific  duties  are  more  favorable  to  that. 

The  law  supposes  that  ad-valorem  duties  are  assessed  on  the  true  value,  and  that 
is  the  intention.  But  when  honest  witnesses  in  court  differ  so  widely,  and  scarcely 
any  two  ever  agree,  how  shall  an  interested  importer  be  controlled,  or  ordinarily 
convicted  of  his  frauds  ?  When  the  importer  can  afford  to  purchase  the  conni- 
vance and  aid  of  a  deputy-collector,  with  a  consideration,  five,  or  ten,  or  twenty 
times  as  much  as  the  officer's  salary,  the  door  to  crime  is  wide  open,  and  the  temp- 
tations, with  such  chances  of  impunity,  are  irresistible.  The  greatest  evil  is  not 
the  robbery  of  the  national  treasury.  That  is  one  of  the  smallest,  though  the 
amount,  in  the  aggregate,  is  very  great.  There  is  crime,  corrupting  the  adminis- 
trators of  the  law,  and  poisoning  the  fountains  of  commercial  integrity.  Neither 
American  merchants,  nor  American  manufacturers,  can  stand  before  such  a  torrent 
of  iniquity.  The  former  are  supplanted,  and  the  latter  are  ruined.  The  very  for- 
eigner, who,  in  his  own  market,  has  sold  a  New  York  merchant  goods  at  one  price, 
comes  here,  under  the  screen  of  his  false  invoices,  and  undersells  him  in  the  very 
same  articles.  How  can  the  American  merchant  stand,  or  the  American  manu- 
facturer live  ? 

The  following  is  an  extract  from  a  memorial  to  the  senate  of  the  United  States, 
signed  by  48  firms,  or  houses,  comprehending  all  the  importing  drygood  merchants, 
of  Boston  : — 

"  To  the  honorable  Senate  of  the  United  States  : 

"  The  undersigned,  your  memorialists,  would  respectfully  represent,  that  they  are 


AND    MODES    OF    A    TARIFF.  513 

Stupendous  mistake  of  the  administration  of  March  4,  1845.  Let 
the  note  below,  and  other  facts  and  reasonings  of  this  chapter,  be 

importers  of  foreisrn  goods  into  the  city  of  Boston,  and  as  such  they  have  examined 
with  alarm  and  consternation,  the  bill  recently  passed  by  the  house  of  representa- 
tives [the  act  of  18-16],  to  change,  in  a  great  measure,  our  system  of  collecting 
duties  on  imports.  Should  the  bill  referred  to  become  a  law  of  the  land,  we  are 
fully  convinced  ihnt  we  shall  be  compelled  to  abandon  our  business  into  the  hands 
of  unscrupulous  foreigners,  who  have  little  or  no  regard  to  our  customhouse  oaths. 
From  long  experience,  we  are  fully  satisfied,  that  we  can  not  compete  with  this 
class,  when  duties  are  based  merely  on  the  ad-valorem  principle." 

The  Hon.  Wm.  H.  Crawford,  secretary  of  the  treasury,  said,  in  1818:  "The 
certainty  with  which  specific  duties  are  collected  give  them  a  decided  advantage 
over  duties  laid  upon  the  valuf,  of  the  article.  It  is  probable  that  the  most  im- 
portant  change  which  can  be  made  in  the  system  will  be  the  substitution  oC  spe- 
cific for  ad-valorem  duties  upon  all  articles  susceptible  of  that  change." 

The  Hon.  James  Buchanan,  of  Pennsylvania,  said,  in  the  senate,  in  1842: 
"  Our  ad-valorem  system  has  produced  great  frauds  upon  the  revenue,  while 
it  has  driven  the  regular  American  merchant  from  the  business  of  importins,  and 
placed  it  almost  exclusively  in  the  hands  of  the  asents  of  British  manufacturers. 
The  American  importer  produces  his  invoice  to  the  collector,  containing  the  actual 
price  at  which  the  imports  were  collected  abroad,  and  he  pays  the  fair  and  regular 
duty  upon  this  invoice.  Not  so  the  British  agent.  The  foreign  manufacturer,  in 
his  invoice,  reduces  the  price  of  the  articles  which  he  intends  to  import  into  our 
country  to  the  lowest  possible  standard  which  he  thinks  will  enable  them  to  pass 
through  the  customhouse  without  being  seized  for  fraud.  And  the  business  has 
been  hitherto  managed  with  so  much  ingenuity  as  generally  to  escape  detection. 
The  consequence  is,  that  the  British  agent  passes  the  goods  of  his  employer 
through  the  customhouse,  on  the  payment  of  a  much  lower  duty  than  the  fair  Ameri- 
can merchant  is  compelled  to  pay.  In  this  manner  he  is  undersold  in  the  market 
by  the  foreigner,  and  thus  is  driven  from  the  competition,  while  the  public  revenue 
is  fraudulently  reduced." 

The  Hon.  Mr.  Evans,  in  a  speech  in  the  senate,  18-16,  adduced  "hundreds  of 
instances"  of  fraud  on  the  revenue,  for  under-valuation  by  foreign  invoices. 

The  following  is  an  extract  from  a  letter  to  the  Hon.  Daniel  Webster,  1846  :  "  A 
merchant  orders  goods  to  be  shipped  from  France  and  entered  at  New  Orleans,  for 
the  western  trade,  with  the  understanding  that  he  is  to  have  them  at  the  foreign 
cost,  with  the  duties  and  charges  added. 

A  shipment  was  made  with  and  forwarded  to  the  purchaser  amount- 
ing to 6,829.93  francs. 

At  the  same  time  the  invoice  forwarded  with  the  goods  to  New  Or- 
leans was 5,258.00  francs. 

Difference 1,571.93  francs. 

Or,  $316.94  out  of  $1,300.94. 

"  The  goods  were  valued,  therefore,  in  the  entry,  at  $316.94  less  than  they  were 
to  the  purchaser;  and  the  purchaser  was  actually  charged  for  the  duty  on  this 
$316.94  as  paid  to  the  government,  amounting  to  $95.10.  Both  the  government 
and  the  purchaser  were,  therefore,  cheated  out  of  that  sum. 

"  This  transaction  occurred  in  the  spring  of  1846,  and  I  send  you  a  copy  of  the 
correspondence  in  which  these  facts  are  stated,  and  not  denied;  but  the  French 
house  attempts  a  round-about  justification  for  putting  the  foreign  cost  to  the  pur- 
chasers at  a  greater  amount  than  the  entry  invoice.  J.  D." 

33 


514  PRINCIPLES,    OBJECTS, 

well  considered.      They  involve  too  grave,  too  momentous  a  ques- 
tion, to  be  lightly  passed  over.     The  principles  of  a  tariff,  as  they 

Again,  another  letter  to  Mr,  Webster : — 

"Boston,  July  17,  1846. 

"Dkar  Sir:  I  am  informed  that  a  respectable  house  in  this  city  received  an  in- 
voice of  European  ^oods  from  a  forei2;n  house,  the  amount  of  which  was  about 
$2,000,  and  that,  after  entering  the  goods  at  the  customhouse  by  the  invoices,  they 
received  another  invoice  valuing  the  same  goods  at  about  $8,000,  with  a  letter, 
stating  that  the  first  invoice  was  to  levy  duties  by,  and  the  second  to  sell  by. 

"  Tiie  consignee  here,  who  is  also  an  importer,  nut  being  willing  to  be  a  party 
to  the  fraud,  deposited  both  invoices  at  the  customhouse,  where  they  were  yesterday. 

"  1  have  no  doubt  of  the  authority  from  which  I  received  this  information,  but  I 
do  not  wish  to  be  quoted  for  it. 

"  I  have  thought  tliat  you  miiiht  be  pleased  to  know  this  fact,  as  the  fraud  is  so 
great,  and  the  perpetrator  beyond  the  reach  of  any  penal  statutes  of  this  country. 

"  Your  most  obedient  servant, 
"Hon.  D.  Webster,  Washington.  • 

"  P.  S.  I  hear  that  Mr.  Lanison  is  the  consignee." 

"  Sir,"  said  Mr.  Webster,  in  the  speech  in  the  senate,  in  which  he  produced  the 
above  letters,  July  25,  1816  :  "Sir,  one  case  more.  A  highly  respectable  firm  in 
Boston  (Messrs.  George  H.  Gray  and  Co.)  have  been  dealers  many  years  in  hard- 
ware, and  in  the  habit  of  making  importations  of  certain  articles  from  the  north. 
In  these  articles  they  found  themselves  constmlly  undersold  by  the  dealers  in 
New  York.  They  could  not  understand  the  reason  of  this  for  a  long  time;  but 
last  spring  the  secret  came  to  light.  They  had  ordered  a  small  amount  of  hard- 
ware to  be  sent  to  them,  and  in  due  lime  the  goods  came,  and  hvo  invoices  came 
with  them.  In  mie  invnice,  the  cost  was  stated  at  958  thalers  ;  in  the  other,  at 
1,402.  And  the  letter  accompanying  these  invoices  says:  'You  find  herewith 
duplicate  invoices  of  the  sreatest  part  of  your  order,  &c.  The  original  1  send  by 
Havre  packet.  You  also  find  herewith  an  invoice  made  up  in  the  manner  like  [that 
which]  the  most  importers  of  your  country  require;  perhaps  to  save  some  duty.' 

"  Now,  sir,  these  oritrinal  invoices,  the  false  and  the  true,  and  the  original  letter 
which  I  have  read,  are  now  in  my  hand  ;  and  any  gentleman,  who  may  feel 
disposed,  may  look  at  them.  Of  course,  Messrs.  Gray  &  Co.  carried  both  invoices 
to  the  customhouse,  because  they  were  honorable  merchants  ;  and  the  duties 
were  assessed  on  the  higher  invoice.  And  by  this  time  these  gentlemen  were  no 
longer  at  a  loss  to  account  for  the  low  price,  at  which  this  description  of  merchan- 
dise had  been  selling  in  the  city  of  JVew  York. 

"  But  now,  sir,  take  not  a  single  case,  but  the  results  of  long  experience.  I  am 
about  to  read  a  letter,  not  addressed  to  me,  but  placed  in  my  hands,  from  a  gentle- 
man well  known,  I  presume,  to  both  the  senators  of  New  York,  and  to  other  mem- 
bers. This  letter,  I  think,  will  startle  the  honorable  chairman.  [The  Hon.  Dixon  H. 
Lewis,  who  had  said,  he  "did  not  believe  that  a  case  of  fraudulent  under-valuation 
had  ever  been  made  out."]     It  must  open  to  his  mind  quite  a  new  view  of  things. 

"'Troy,  July  14,  1846. 

"  '  Le  Grand  Cannon,  Esq. — Sir:  Agreeably  to  your  wish,  I  avail  myself  of 
this  opportunity  to  give  you  the  benefit  of  my  experience  in  mercantile  and  manu- 
facturing business,  hoping  it  may  tend  to  an  improvement  of  the  bill,  now  pending 
in  the  senate,  for  the  collection  of  duties.  I  hope  members  of  Congress  will  have 
the  same  views  of  the  probable  results  which  I  anticipate;  which  are,  that  the  sys- 
tem ol'ad-valorem  duties  does  give  the  foreign  importer  and  manufacturer  a  very 
undue  advantage  over  the  American  importer.     This  will  be  apparent  from  my 


AND    MODES    OF    A    TARIFF.  515 

respect  the  objects  of  duties  and  the  modes  of  collecting  thenn.  in- 
volve the  most  important  subjects  of  American  legislation,  and  it 
would  be  well  for  the  country  if  the-^^^American  statesman  who  does 
not  understand  them,  should  resign  his  pretensions,  and  go  home 
to  school. 

own  experience,  which  I  give  you  annexed.  My  brother  and  myself  were  brought 
up  in  ilie  town  of  Manchester,  and  well  acquainted  with  the  manufacturers  and 
manufacturing.  At  the  a?e  of  twenty  years  it  appeared  very  evident  to  me  that 
we  could  finish  goods  and  import  troods  into  New  York  about  ten  per  cent,  lower 
than  the  American  merchant;  and  with  this  conviction  I  agreed  to  come  out  to 
New  York  and  dispose  of  the  goods,  and  leave  my  brother  to  finish  and  forward 
the  goods. 

"'The  result  was  equal  to  our  expectations.  We  imported  our  goods  ten  per 
cent,  cheaper  than  our  competitors,  and  by  the  ad-valorera  duties  we  paid  nearly 
five  per  cent  less  duties;  so  that,  in  twenty-two  years,  we  made  nearly  a  million 
of  dcdiars,  while  nearly  all  the  American  merchants  failed.  Now,  I  reason,  what 
has  been  will  be;  and,  should  the  present  tariff  bill  pass,  it  will  give  the  foreign 
manufacturer  a  decided  advantage,  and  tend  to  reduce  the  rate  of  duties  lower  than 
is  anticipated.  And  I  can  not  avoid  expressing  my  decided  opinion  in  favor  of 
specific  duties,  as  then  the  foreign  manufacturer  would  pay  the  same  duties  as  the 
American  importer.  Benj.  Marshall.' 

"  Can  any  man  gainsay  the  truth  of  all  this  ?  Is  there  a  merchant,  foreign  or 
American,  in  the  United  States,  who  will  express  any  contrariety  of  opinion  ?  Is 
there  a  man,  high  or  low,  who  denies  it  ?  I  know  of  none ;  I  have  heard  of  none. 
Sir,  it  has  been  the  experience  of  this  government,  always,  that  the  ad-valorem  sys- 
tem  is  open  to  innumerable  frauds.  What  is  the  case  with  England  ?  In  her  new 
notions,  favorable  to  Free  Trade,  has  she  rushed,  madly,  into  a  scheme  of  ad-valo- 
rem duties  ?  Sir,  a  system  of  ad-valorem  duties  is  not  Free  Trade,  but  fraudulent 
trade.  Has  England  countenanced  this  ?  Not  at  all;  not  at  all.  Sir, on  the  con- 
trary, on  every  occasion  of  a  revision  of  the  tariff  of  England,  a  constant  effort  has 
been  made,  and  progress  attained  in  evei7  case,  to  augment  the  number  of  specific  du- 
ties, and  reduce  the  number  of  arf-ra/orem  duties.  A  gentleman  in  the  other  house 
[Mr.  Seaman]  has  taken  pains  —  which  I  have  taken  also,  though,  I  believe,  not 
quite  so  thoroughly  as  he  has  —  to  go  through  the  items  of  the  British  tariff,  and 
see  whnt  proportion  of  duties  in  that  tariff  are  ad  valorem,  and  what  are  specific. 
Now,  sir,  the  result  of  that  examination  shows,  that  at  this  day,  in  this  British 
tariff,  out  of  714  articles,  608  are  subject  to  specific  duties.  Everything  that  from 
its  nature  could  be  made  specific,  is  made  specific ;  nothing  is  placed  in  the  list  of 
ad-valorem  duties  but  such  as  seem  to  be  incapable  of  assessment  in  any  other 
form.  Well,  sir,  how  do  we  stand,  then  ?  We  have  the  experience  of  our  own 
government;  we  have  the  judgment  of  those  most  distinguished  in  the  administra- 
tion of  our  affairs;  we  have  the  production  of  proof,  on  this  most  important  point, 
in  hundreds  and  hundreds  of  instances,  of  the  danger  of  the  ad-valorem  mode  of 
assessing  duties.  What  is  produced  in  its  favor?  Every  importer  of  the  United 
States,  without  exception,  is  against  it." 

"This  letter  [Mr.  Marshall's],  I  think,  will  startle  the  honorable  gentleman." 
It  is,  undeniably,  a  startling  document.  It  is  only  wonderful,  that  a  person,  who 
had  been  a  particeps  criminis,  in  this  business,  could  have  made  the  disclosure. 
He,  doubtless,  as  all  foreign  factors  do,  when  the  laws  of  the  United  States  open 
the  door,  considered  the  game  a  fair  one;  and  the  country  is  at  least  under  one 
obligation  to  him,  viz.,  for  the  excellent  advice  of  this  letter. 


516  THE    TARIFF    OF    1846. 


CHAPTER   XXXII. 

THE    TARIFF    OF    1846. 

The  TariflF  of  1846  a  Surrender  and  Abandonment  of  the  Principles  of  Protection. — Popnlar 
Instincts  on  this  Subject.— It  takes  Years  for  the  Proof  of  a  new  Tariff  Policy.— 
Probable  Result  of  the  Tariff  of  1846.— A  Table  showing  the  Effects  of  the  Tariff  of 
1840  on  American  Labor  and  Arts — Remarks  upon  this  Table. — The  Effect  of  Auction- 
Sales  of  Imports  on  American  Labor  and  Trade. — Importance  of  harmonious  Legi.sla- 
tion  between  Federal  and  State  Authorities  for  Auction  of  Imports — The  Di.scrimina- 
tions  of  the  Tariff  of  1846  against  American  Industry  and  Labor.— Tables  in  Pronf- — 
Object  of  the  Anti-Corn  Law  League  of  England —False  Reasonings  of  Free  Trade 
on  the  Effects  of  the  Famine  in  Ireland  and  of  the  short  Crops  of  Europe. 

As  the  principles  of  the  tariff  of  1846  are  opposed  to  those  of 
this  work,  and  being  now,  in  1848,  in  actual  operation  as  the  law 
of  the  land,  it  is  regarded  not  only  as  suitable,  but  necessary,  for 
the  complete  elucidation  of  our  principles,  to  take  some  further 
notice  of  it  than  is  done  in  the  preceding  chapter,  and  elsewhere 
by  incidental  allusions,  or  in  the  discussion  of  abstract  principles. 
As  our  aim  from  the  beginning,  and  throughout,  is  to  show  what 
plan  of  public  economy  is  best  adapted  to  the  United  States,  an 
actual  system  in  operation,  which  we  regard  as  ill  adapted  and  in- 
jurious, could  not  with  propriety  be  left  unnoticed. 

The  tariff  of  1846  is  a  surrender  and  an  abandonment  of  the 
principle  of  protection.  This  is  not  only  understood,  but  the  ob- 
ject is  avowed  in  the  messages  of  the  president  and  in  the  reports 
of  the  secretary  of  the  treasury.  In  these  documents  the  question 
is  argued,  and  there  is  no  concealment  of  the  design  ;  although,  to 
obtain  the  necessary  revenue,  which  is  the  principle  of  the  meas- 
ure, some  degree  of  protection,  in  some  quarters,  remains,  not  as 
an  object,  but  as  a  result  which  could  not  be  altogether  prevented. 
This  is  an  event  of  no  inconsiderable  importance  in  the  political 
history  of  the  country. 

We  have  elsewhere  had  something  to  say  of  the  instincts  of  the 
American  people  on  this  subject ;  and  it  may  not  be  amiss  to  en- 
large upon  that  point  a  little  in  this  place.  Reason  is  fallible  ;  but 
instinct  never  errs.  The  instincts  of  animal  tribes  are  the  guidance-' 
of  the  Divinity  within  them.  Man,  too,  is  endowed  with  instinct, 
but  in  an  imperfect  degree,  compared  with  animals.     Reason,  a 


THE    TARIFF    OF    1846.  517 

higher  and  nobler  attribute,  was  given  him,  to  preside  over  instinct; 
but  reason  is  often  unfortunate  in  its  dictations. 

If  the  convicts  of  all  the  state-prisons  in  the  United  States  were 
put  to  making  shoes,  and  the  state  should  throw  tiieni  into  market 
at  a  small  advance  on  the  cost  of  the  materials  and  the  subsistence 
of  the  convicts,  would  it  be  necessary  for  the  free  laborers  engaged 
in  this  pursuit  to  study  and  understand  public  economy,  before  they 
could  appreciate  the  effects  of  this  measure  on  themselves  ?  Their 
instincts  would  leap  to  the  conclusion  with  the  speed  of  lightning. 
They  would  be  excited,  alarmed.  The  riotous  disposition  mani- 
fested in  the  city  of  New  York,  a  few  years  ago,  for  using  the  Sing- 
Sing  marble,  quarried  and  dressed  by  the  convicts,  and  called  the 
"state-prison  monopoly,"  which  was  sold  at  prices  to  paralyze  the 
arm  of  free  laborers,  is  directly  in  point.  In  the  same  manner,  all 
the  free  laborers  of  the  United  States  know  that  Europe  is  but  a 
prison-house  for  labor,  forcing  it  to  toil  for  bare  subsistence,  and 
that  it  is  equally  unfair  and  wrong  to  force  them  into  a  competition 
with  such  a  power  as  to  force  shoemakers  or  stonecutters  to  com- 
pete with  the  convicts  of  state-prisons.  And  all  the  business  pur- 
suits of  the  country  sympathize  with  each  other.  One  can  not  be 
wronged,  but  all  are  injured  ;  and  if  labor,  the  grqat  power  of  the 
country,  on  which  all  depend,  is  depressed,  all  feel  it.  Any  meas- 
ure of  the  government  that  begins  to  look  like  an  invasion  of  the 
rights  of  labor,  startles  the  wide  cotnmunity,  and  people  are 
alarmed.  Nor  is  there  any  mistake  in  it ;  what  all  see,  is  truth  ; 
it  is  impossible  that  such  instincts  should  err. 

This  is  what  is  called  a  panic.  It  is  an  error  to  say  it  is  got  up. 
Trade  never  commits  suicide  ;  it  never  does  that  willingly  which 
is  injurious  to  itself;  but  it  will  keep  off  a  panic  as  long  as  possible. 
Nor  can  a  few  interested  persons,  like  the  bears  in  Wall  street, 
make  a  general  panic.  If  they  succeed  in  depressing  stocks  a  lit- 
tle one  day,  they  will  rise  the  next.  Such  a  thing  as  a  general 
panic  was  never  known,  in  any  country,  without  cause.  It  is  the 
quick  operation,  the  infallible  foresight,  the  premonition  of  the  in- 
stincts of  the  wide  community. 

In  this  manner,  the  inaugural  address  of  President  Polk,  on  the 
4th  of  March,  1845,  distinctly  foreshadowing  the  downfall  of  the 
protective  system,  as  one  of  the  great  aims  of  his  administration, 
startled  the  country.  The  people  were  enjoying  great  blessings 
under  the  tariff  of  1842.  Labor  everywhere  found  employment 
and  reward,  and  the  nation  had  risen  from  a  long  period  of  suffer- 


518  THE    TARIFF    OF    1846. 

in"-  and  calamity,  produced  by  the  reign  of  Free-Trade  principles, 
to  an  unexampled  and  rejoicing  career  of  prosperity.  To  have 
such  a  condition  menaced,  from  such  a  quarter,  was  alarming. 
Nevertheless,  a  sanguine  people  will  still  hope  on,  and  though 
timid  from  instinctive  dread,  they  waited  for  the  message  of  De- 
cember 2,  1845,  from  which  time  till  the  passage  of  the  tariff  of 
July  30,  1846,  the  commercial  business  of  the  wliole  country  was 
paralyzed  with  apprehension.  It  was  the  operation  of  the  public 
instincts.  Ships  in  large  numbers,  ready,  or  nearly  ready,  or  pre- 
paring, to  sail,  freighted  with  wealth,  were  stopped  ;  voyages  were 
delayed  ;  orders  for  goods  were  countermanded,  and  others  kept 
back  ;  many,  and  some  vast,  schemes  of  domestic  enterprise,  with 
a  corresponding  capital  ready  to  be  invested  for  the  employment 
of  labor,  were  arrested  ;  and  all  these  great  transactions,  connected 
by  a  thousand  channels  and  a  thousand  links  with  all  the  other 
great  and  minor  interests  of  the  country,  were  held  in  suspense  for 
eight  long  and  tedious  months,  waiting  for  the  blow  that  was  so 
seriously  apprehended,  the  falling  of  which  only  demonstrated  that 
these  instincts  of  the  people  were  infallibly  just.  One  hundred  mil- 
lions of  dollars  would  not,  probably,  fully  indemnify  the  people  of 
the  United  States  for  all  the  injury  done  to  their  vast  and  compli- 
cated interests  during  this  agitation,  till  the  consummation  of  the 
scheme  which  it  proposed  to  fasten  upon  the  country.  What,  then, 
must  be  the  sequel  ? 

The  sequel  is  yet  in  the  future.  It  takes  years  for  a  great  and 
comprehensive  measure  of  this  kind,  to  be  fully  proved  ;  and  the 
natural  results,  in  their  proper  and  full  measure,  will  be  staved  off, 
till  the  crops  of  Europe  and  other  foreign  parts,  shall  yield  their 
customary  abundance;  or  possibly  now,  till  the  extraordinary  events 
opened  in  Europe,  beginning  at  Paris,  February,  1848,  shall  have 
assumed  a  more  settled  state.  If  the  want  of  confidence  in  Eu- 
ropean institutions,  at  such  a  time  of  general  agitation,  should  in- 
duce European  capitalists,  in  any  considerable  extent,  to  transfer 
their  funds  to  the  United  States,  it  will  of  course  defer  the  natural 
effects  and  full  proof  of  the  tariff  of  1846  to  a  still  later  period, 
by  the  supply  of  specie  which  such  transfer  of  capital  would  bring 
to  the  United  States,  in  the  same  manner  as  the  late  failure  of  the 
European  crops  did.  Nothing  but  extraordinary  events  like  these, 
tendino-  to  bring  specie  to  this  country  for  the  time  of  their  con- 
tinuance, can  put  off  the  commercial  disasters  which  the  tariff  of 
1846  is  necessarily  destined  to  inflict  on  the  country  ;  and  the 


THE    TARIFF    OF    1846.  519 

longer  they  are  deferred,  the  more  heavy  will  be  their  fall.  Enough, 
indeed,  has  already  transpired,  in  connexion  with  the  experience 
of  former  years,  under  the  two  antagonist  systems  of  protective 
and  anti-protective  duties,  to  prognosticate,  with  a  sufficient  degree 
of  certainty,  the  coming  results.  Not  less,  probably,  than  a  hun- 
dred millions  of  capital,  waiting  for  the  decision  of  this  great  ques- 
tion, and  ready  to  be  invested  in  a  great  variety  of  enterprises  for 
the  employment  of  labor,  and  for  the  increased  production  of  pri- 
vate, public,  and  national  wealth,  have  already  been  locked  up, 
or  turned  to  employments  not  productive  of  the  general  good. 
*'  Capital,"  says  the  iSouthern  Planter,  "  when  not  permanently  in- 
vested, merely  seeking  interest  annually,  is  almost  sure  to  do  more 
harm  than  good,  because  those  branches  most  depressed  and  in 
debt  are  the  first  to  come  forward  to  take  offered  loans,  to  pay  their 
old  debts,  under  the  hope  that  business  will  revive  so  as  to  justify 
the  transaction  Alas  !  soon  they  become  convinced,  that  the  cap- 
italist will  absorb  all,  and  end  in  a  break-up  for  both."  Such,  all 
know,  was  the  result  of  the  great  revulsion  of  1836-'7.  While 
there  was  no  encouragement  for  the  investment  of  capital  in  those 
establishments,  and  in  enterprises,  manufacturing  and  other,  which 
employ  labor  and  promote  the  general  good,  it  turned  itself  to  se- 
cure mortgages  on  the  distressed,  and  made  vastly  more  profits  in 
the  end  than  it  could  have  done  in  any  other  way,  in  the  ruin  of 
the  thousands  that  asked  its  aid.  Here  is  disclosed  a  great  princi- 
ple, apparently  not  discerned  by  those  who  have  sought,  by  legis- 
lation, to  depress  capital,  and  impair  its  position  relative  to  other 
interests.  They  only  elevate  and  strengthen  it,  positively  in  some 
cases,  relatively  in  all.  They  create  the  very  monopoly,  the  very 
power,  of  which  they  complain.  Before,  it  was  no  monopoly  — 
no  undue  influence,  as  shown  in  these  pages.  But  under  the  tariff 
of  1846,  the  strong  manufacturing  establishments  which  are  able 
to  stand,  will  be  strengthened  by  the  breaking  down  of  the  weak, 
and  the  consequent  greater  business  they  will  have.  Lowell  will 
not  suffer,  except,  perhaps,  in  its  printing  establishments  and  wool- 
len factories.  Lowell  will  stand  in  spite  of  the  world,  and  rise  and 
flourish  on  the  ruins  of  all  around  ;  and  the  greater  the  general 
ruin,  so  much  greater  at  least  its  relative  strength,  and  so  much 
firmer  its  relative  position.  It  is  the  weak  that  will  be  stricken 
down  by  the  tariff  of  1846  ;  it  is  the  labor  of  the  country  that  will 
suffer  first  and  most.  Capital  will  always  take  care  of  itself. 
Some  of  it,  being  so  invested  as  to  be  assailed  by  legislation,  may 


520  THE    TARIFF    OF    1846. 

suffer;  but  itVill  make  shifts,  and  live;  while  that  which  is  ready- 
to  take  advantage  of  the  change,  will  double,  or  triple,  or  quadru- 
ple itself,  in  a  short  period  of  general  distress.  But  labor  can  not 
take  care  of  itself;  it  is  dependent  on  employment ;  it  will  fall  be- 
fore the  first  rude  blast  of  the  storm.  He  who  has  contributed,  by 
le"-islation,  to  silence  the  music  of  the  hammer,  the  noise  of  the 
shutde,  the  whistle  of  the  ploughman,  the  song  of  the  boatman  and 
sailor,  and  the  varied  harmony  of  industry,  has  taken  away  the 
bread  of  dependent  wives  and  children,  clothed  them  in  rags,  left 
them  to  shiver  in  winter's  cold,  and  drag  out  a  life  of  sorrow  and  pain. 

All  classes  of  the  people  are  afloat  in  one  ship,  and  though  tossed 
and  pelted  by  a  merciless  tempest,  they  will  try  hard  to  bring  the 
vessel  into  port  again.  They  will  endeavor  to  accommodate  them- 
selves to  their  position.  The  weak  will  fall,  and  the  laborer  will 
find  it  hard  to  get  bread.  The  great  improvements  and  enterprises 
of  the  country  will  be  checked  for  years.  The  nation,  probably, 
will  not  go  backward  ;  neither  will  it  go  forward.  All  classes  will 
be  obliged  to  stand  it  as  well  as  they  can.  This  country,  thank 
God,  has  too  many  resources,  for  the  people  to  be  reduced  to 
absolute  want,  to  starvation,  before  they  will  see  the  cause  of  their 
misfortunes,  and  be  able  to  apply  a  remedy.  But  why  should 
such  a  country  suffer  such  misfortunes,  if  government  was  not  in- 
stituted to  prove  how  much  the  people  can  endure?  They  have 
gone  through  it  all  once,  and  but  recently.  Why  should  they  be 
compelled  to  go  through  it  all  again  ? 

The  fall  in  the  prices  of  labor,  under  the  tariff  of  1846,  will  not 
probably  be  so  early,  or  so  great  at  an  early  period,  as  some  have 
apprehended  ;  but  the  final  result  can  not  be  avoided  under  such  a 
system.  It  has  not  been  easy,  down  to  this  time,  to  obtain  a  full 
supply  of  labor  for  the  manufactui'es  of  the  country,  because  the 
demand  calls  laborers  off  from  other  pursuits,  and  requires  an  ap- 
prenticeship. All  those  manufacturers,  therefore,  who  have  any 
hope  of  standing,  or  who  are  obliged  for  the  present  to  continue, 
will  also  be  obliged  to  keep  up  the  wages  of  labor  as  long  and  as 
high  as  they  can  —  even  after  their  business  may  have  become  a 
losing  one  —  in  hope  of  a  favorable  change.  The  disastrous  effects 
of  the  new  tariff  will  fall  first,  and  continuously,  on  the  weak,  to 
make  them  weaker,  and  on  the  poor,  to  make  them  poorer;  while 
the  strong  will  grow  stronger  —  at  least  relatively,  in  some  cases 
positively  —  and  the  rich  richer. 

When  weak  manufacturers,  and  other  employers  of  labor  who 


THE    TARIFF    OF    1846.  521 

are  comparatively  weak,  are  obliged  to  suspend  their  business, 
there  will  then  be  a  surplus  of  labor  seeking  employment;  and  as 
in  every  other  case  of  surplus,  no  matter  what,  prices  will  fall. 
They  may  fall  rapidly  and  greatly.  Such  will  unavoidably  be  the 
effect,  when  there  is  much  labor  out  of  employment.  It  is  in  such 
a  state  of  things,  when  the  weak  break  down,  and  the  poor  are  suf- 
fering for  want  of  something  to  do,  that  the  rich  grow  richer,  and 
the  strong  stronger,  because  they  are  able  to  take  advantage  of 
cheap  commodities,  cheap  labor,  and  of  the  necessities  of  those 
who  are  trying  to  get  along  by  borrowing  money  at  exorbitant  rates, 
most  of  whose  estates  fall  at  last  into  the  hands  of  their  creditors. 
Such,  precisely,  as  before  described,  and  as  most  people  remember, 
to  their  sorrow,  was  the  state  of  things,  before  the  tariff  of  1S42 
came  to  the  rescue  and  relief  of  the  country. 

To  show  how  the  tariff  of  1846  will  operate  on  the  labor  of 
the  country,  and  the  interests  which  sustain  labor,  the  table  in  the 
note  below  was  prepared  by  the  Hon.  Mr.  Stewart,  of  Pennsylva- 
nia, while  the  tariff  of  '46  was  under  debate,  and  requires  no  altera- 
tion, as  the  bill  as  to  these  items,  passed  precisely  as  it  stood  then, 
and  is  now  part  of  the  law.* 

•  "  The  operation  of  this  bill,"  said  Mr.  Stewart,  "upon  the  national  industry, 
will  be  seen  from  the  followinsr  examples,  assuming  that  the  reduction  of  wages 
will  always  be  in  proportion  to  the  reduction  of  protection,  and  that  as  home  con- 
sumption can  not  be  increased,  home  production  must  be  diminished  to  the  extent 
of  the  increased  importations  : — 

Importations         Est.  inrrease      DutieB  of  Turiff 
mider  the  iinjiort3  under   of '42,  tu  per  Mr.  Duties  of  Tariff 

Employments,  &c.  TaiiB'  of  LS-fcJ.        Tariif  of  MO.     Walker's  report.  of  '40. 

Shoemakers $42,250  $45,000  45  per  ct.  30  per  ct. 

Tailors 1,173,028  200,000  50  "  30  " 

Blacksmiths —  200,000  61  "  30  « 

Hatters 16,646  110,000  49  «  30  « 

Tanners  128,277  100,000  40  «  20  " 

Iron-makers 4,489,553  1,185,000  75  «  30  « 

Miners  of  coal 223,919  5,150,000  67  «  30  " 

Glass-makers 106,905  100,000  90  «  25  " 

Paper-makers 51,724  150,000  75  "  30  « 

Hemp,  cordage,  &c 355,875  275,000  65  "  25  " 

Lead —  ~—  92  «  20  « 

Pins 45,078  50,000  70  «  20  « 

Nails  and  spikes —  _  66  "  20  « 

Manufactures  of  wool 10,057,875  2,000,000  40  "  30  « 

Manufactures  of  cotton —  —  90  "  25  " 

Manufactures  of  silk —  _  42  «  25  « 

Salt 898,663  1,000,000  76  "  20  « 

Sugar 4,780,555  630,000  75  «  30  « 

Brandy  and  spirits  distilled  from  grain,  &c.  —  180  "  100  " 

Wool. 1,689,794  200,000  40  «  30  « 

Blankets —  _  30  "  20  " 

Potatoes 58.949  150,000  36  "  20  « 


622  THE    TARIFF    OF    1846. 

It  is  clear,  that  the  tariff  of  1846  must  uhimately  either  fail  of 
its  object  as  a  revenue  measure,  or  cripple  the  labor  of  the  country 

This  table  might  be  extended  much  farther;  but  it  is  sufficient  to  exhibit  the 
practical  operation  of  the  new  tariff  on  labor,  so  long  as  that  measure  answers 
any  purpose  for  revenue  ;  and  on  labor  and  the  currency,  when  the  revenue  shall 
fail ;  for  tiie  act,  as  a  revenue  measure,  will  not  fail  entirely,  till,  and  only  because, 
labor  and  the  currency  are  both  broken  down. 

The  various  branches  of  American  labor  named  in  the  above  table,  will  of  course 
see  the  amounts,  respectively,  by  %vhich  their  occupations  are  to  be  curtailed,  in 
the  operations  of  the  new  tariff.  They  read  their  doom  in  the  second  column. 
That  is  the  amount  of  business  of  which  they  are  to  be  deprived.  They  are  the  sec- 
retary's own  figures.  He  openly  proposed,  in  his  report,  to  substitute  the  products 
of  European  labor  for  those  of  American  ;  and  this  is  the  way  and  the  measure  of 
doing  it.     Mr.  Stewart  says  : — 

"The  question,  then,  is  distinctly  presented  to  all  these  mechanics,  manufac- 
turers, and  farmers,  whether  they  are  prepared  to  submit  to  these  reductions  in 
their  prices  and  wages,  or  give  up  the  market  to  foreigners  ?  One  or  the  other 
they  must  do — and  why  ?  The  secretary  says,  to  increase  the  revenue;  but  this 
is  manifestly  not  true ;  for  when  you  take  all  the  increase  of  imports  the  secretary 
himself  estimates,  and  assess  on  these  the  proposed  reduced  duties,  there  will  be, 
on  his  own  showing,  a  loss  instead  of  a  gain  of  revenue.  Then  why  the  proposed 
reduction  ?  To  substitute /o?gig7i  for  ./imerican  fabrics,  as  declared  in  the  secre- 
tary's report.  To  fgivor  foreigners  by  breaking  down  American  mechanics,  manu- 
facturers, and  farmers." 

The  following  authenticated  facts  which  have  already  transpired,  in  relation  to 
some  other  items  of  American  industry  and  art,  not  mentioned  in  the  preceding  ta- 
ble, are  sad  monitions  of  the  fate  in  store  for  American  labor,  under  this  unfortunate 
measure.  Under  the  tariff  of  1842,  the  imports  into  the  United  States  from  Eng- 
land of  plain  calicoes,  were,  for  1844,  9,661,820  yards;  for  1845,  12,412,908  yards; 
for  1846,  10,640,215  yards.  But  behold  the  effect  of  the  tariff  of  1846.  These 
same  imports  in  1847,  from  England,  amounted  to  41,519,224  yards,  being  an  ex- 
cess of  about  30,000,000  of  yards  a  year  over  the  average  imports  under  the  tariff 
of  1842;  or  an  increase  of  nearly  300  per  cent.  There  was  also  for  1847  just 
about  the  same  excess  of  imports  of  printed  and  dyed  calicoes,  over  those  under 
the  tariff  of  '42.  The  following  items  mark  these  excesses  of  imports,  severally, 
for  1847,  over  the  average  of  the  years  under  the  former  tariff. 

Calico,  yards 30,879,029 

Lace,  yards 4,669,340 

Cambrics  and  musljns,  yards 1,048,654 

Cotton  and  linen,  yards 518,381 

Cords,  velveteens,  &c.,  yards 200,082 

Calicoes,  printed  and  dyed,  yards 30,868,508 

Total  yards  increase 68,183,904 

Threads,  lbs 419,945 

All  this  has  in  one  year  been  snatched  from  the  hand  of  American  industry  and 
art,  by  the  tariff  of  1846,  and  given  to  foreign  artisans  and  factors;  that  is,  enough 
to  give  three  yards,  and  more,  to  every  man,  woman,  and  child,  in  the  United 
States.  And  what  is  more,  the  price  of  each  of  these  articles,  which  had  the 
promise  of  being  reduced  by  the  new  tariff,  is  quoted  higher  in  the  British  market 
for  1847,  than  for  either  of  the  three  preceding  years.  But  this  is  only  the  begin- 
ning of  the  end.     When  we  shall  have  the  full  account  of  all  those  excesses  of 


THE    TARIFF    OF    1846.  523 

and  destroy  its  currency.  It  will  undoubtedly  do  the  last,  and  to  a 
great  extent  accomplish  the  first.  That  it  will  do  the  last,  is  proved 
from  experience.  No  system  of  low,  anti-protective  duties,  has 
ever  been  in  operation  in  this  country,  without  these  results,  as  has 
been  abundantly  demonstrated  in  these  pages.  Importations,  in  all 
such  cases,  flood  the  country,  as  long  as  there  is  money  to  pay  for 
them  ;  and  when  that  is  gone,  to  the  breaking  point  of  credit.  Of 
course,  and  uniformly,  the  money  being  gone,  and  credit  failing,  the 
currency  fails,  and  labor  is  prostrate,  first  on  account  of  low  wages, 
and  next  for  want  of  employment.  Cheap  foreign  labor  has  done 
that  which  American  labor  ought  to  have  done  —  has  superseded 
the  latter,  by  being  imported  in  the  shape  of  manufactured  goods 
—  has  surfeited  the  market,  and  produced  universal  stagnation. 
When  trade  languishes,  for  want  of  money  and  credit,  labor  is  the 
first  and  chief  sufferer. 

The  tariff  of  1846  is  doubtless  sufScient  to  accomplish  these 
objects,  in  its  experiment  as  a  new  revenue  system ;  and  before  it 
shall  have  half  done  it,  it  will  itself  fail  for  purposes  of  revenue. 
When  duties  were  on  the  same  scale,  in  the  last  year  of  the  com- 
promise act,  called  the  fiscal  year  of  1842,  the  revenue  from  cus- 
toms ran  down  to  about  twelve  millions  and  a  half,  which  is  less 
than  half  the  average  product  of  the  tariff  of  1842.  There  is 
little  reason  to  suppose  that  the  tariff  of  1846  will  do  better  than 
this  in  the  end  ;  for  how  can  the  country  afford  to  buy  so  much 
any  length  of  time?  These  excesses  of  imports  may  fill  the  treas- 
ury for  a  year  or  two  ;  but  the  money  of  a  spendthrift  is  soon  gone. 

There  is  one  mode,  some  time  in   use,  in  disposing  of  surplus 

accumulations  of  manufactured  goods  in  England  and  Europe  — 

and  it  applies  to  all  kinds  of  manufactures  —  which  is  not  commonly 

observed,  and  which  is  the  worst  of  all  for  American  interests  of 

manufacture,  trade,  and  labor,  besides  being  extremely  difficult  to 

control.     These  surpluses  are  constantly  accumulating  in  Europe, 

not  only  by  regular  production,  in  the  hands  of  manufacturers,  but 

by  bankruptcies.     They  are  dead  property  at  home,  and  must  be 

disposed  of  in  some  foreign  market,  at  whatever  sacrifice.      The 

inquiry  in  all  such  cases  is,  "  What  market  is  the  best  ?"     And 

the  uniform  answer  is,  "The  United  States  —  New  York  ;"  and 

imports  under  the  tariff  of  1846,  over  those  under  the  tariff  of  1842,  in  manner 
as  above — excesses  which  have  raised  thirty  millions  of  revenue  under  the  reduced 
duties — it  will  be  yet  a  sadder  tale  for  American  labor,  though  this  evil  will 
doubtless  be  abated,  in  no  inconsiderable  decree,  by  the  previous  larse  imports  of 
specie  for  American  breadstuffs  sent  to  supply  the  wants  occasioned  by  famine. 


524  THE    TARIFF    OF    1846. 

hither  they  are  shipped  and  consigned,  with  orders  to  be  sold  by 
private  negotiation  or  by  auction.  Sold  they  must  be  and  will 
be,  at  whatever  yrice  they  will  bri?ig,  generally  at  a  sacrifice  on  the 
cost  of  production  in  Europe.  A  house  in  New  York  received  a 
large  consignment  of  goods  in  this  way,  in  1846,  and  sold  them  at 
an  average  of  less  than  50  per  cent,  of  the  original  cost  of  produc- 
tion. This  business,  as  is  known  to  the  merchants  of  New  York, 
is  done  on  a  large  scale.  It  is  forcing  off  the  goods.  Nor  is  this 
mode  of  sale  limited,  either  as  to  quantity  or  time,  but  unlimited. 
It  is  a  regular,  uninterrupted,  systematic  trade,  carried  on  for  more 
than  twenty  years,  to  dispose  of  surpluses  on  hand  in  Europe. 
As  the  sources  are  inexhaustible,  embracing  all  kinds  of  manufac- 
tures, without  the  application  of  a  legislative  remedy,  the  flood  is 
destined  apparently  to  increase,  and  to  overwhelm  the  labor  and 
manufacturing  interests  of  the  country,  together  with  American  im- 
porting merchants.  It  will  naturally  be  vastly  augmented  by  the 
low  duties  of  the  tariff  of  3  846.  Nor  can  any  remedy  be  found, 
short  of  a  union  of  state  and  federal  legislation.  So  long  as  the 
laws  of  the  state  of  New  York  impose  but  1^  per  cent,  duties  on 
foreign  goods  sold  at  auction,  the  practice  can  never  be  arrested. 
In  this  way,  all  the  regular  manufacturing  and  importing  business 
of  the  country  is  endangered,  and  American  labor  is  doomeiJ  to  fall 
with  it,  necessarily  and  unavoidably  ;  for,  in  such  a  case,  American 
labor  has  to  compete,  not  with  the  low-priced  labor  of  Europe  at 
par,  but  at  a  discount,  sometimes  of  50  per  cent. ;  that  is,  with  the 
pauper  labor  of  Europe  at  half  price,  the  average  of  which  is  about 
one  sixth,  or  17  per  cent,  of  the  average  price  of  American  labor. 
American  merchants  and  manufacturers  are  first  injured  ;  but  it  all 
ends  in  depriving  American  labor  of  its  rights. 

It  may  perhaps  be  said  that  this  is  all  for  the  benefit  of  consu- 
mers. But  it  does  not  operate  so.  It  is  the  sole  benefit,  first,  of 
those  holders  of  these  surpluses  in  Europe,  who  can  not  oti)ervvise 
dispose  of  them  ;  next,  of  the  jobbers,  who  make  the  first  purchase, 
and  thirdly,  of  the  retailers.  Before  they  get  into  the  hands  of 
consumers,  the  prices  are  up  to  the  ordinary  level.  The  whole 
tendency  of  the  operation  is  to  injure  the  regular  trade  and  the  labor 
of  the  country. 

A  few  words  are  due  on  the  discriminations  of  the  tariff  of  1846 
against  labor,  manufactures,  and  the  arts.  It  has  been  pretended 
that  England  and  the  United  States  are  marching,  with  equal  strides, 
toward  the  goal  of  Free  Trade.    It  is  elsewhere  shown  in  this  work, 


THE    TARIFF    OF    1846.  525 

that  the  recent  aheratlons  of  the  British  tariff,  alleged  to  be  of  this 
character,  have  been  made  on  the  principle  of  Protection,  generally 
or  specifically.  When  the  Manchester  and  other  British  manufac- 
turers ask  for  what  is  there  called  Free  Trade,  they  ask  it  to  fortify 
their  own  position  in  relation  to  the  rest  of  the  world,  hoping  their 
example  will  be  followed  by  other  nations,  and  believing  them- 
selves strong  enough,  for  the  most  part,  to  defy  and  break  down 
competition  on  this  pretended  basis  of  free  ports.  It  is  remarkable, 
however,  that  they  do  not  ask  for  the  remission  of  the  differential 
duties  in  their  favor,  in  supplying  the  wants  of  British  dependen- 
cies. Mr.  Edwin  Williams,  than  whom  a  more  reliable  authority 
in  such  matters  could  not  be  cited,  in  an  article  in  Fisher's  National 
Magazine  for  September,  1846,  has  clearly  shown,  that  the  late 
abatements  of  duty  in  the  British  tariff,  vaunted  so  loudly  as  Free- 
Trade  reductions,  if  so  nominally,  are  quite  the  other  way  in  their 
practical  operation.  He  has  proved,  in  the  first  place,  that  the  reve- 
nue sacrificed  is  trivial,  and  that  they  gain  on  that  score  more  than 
they  lose.  But  secondly,  the  most  important  point  established  is, 
that  these  numerous  changes,  except  that  of  the  abolition  of  the 
corn  laws,  have  been  made  directly  —  abolition  of  corn  laws  indi- 
rectly—  for  the  protection  of  British  manufactures  and  arts,  by  the 
abolition  of  duties  on  raw  materials,  and  partially  manufactured  ar- 
ticles imported  for  their  perfection  by  British  skill  and  labor. 
Whereas,  the  American  tariff  of  1846  has  imposed  duties  in  these 
very  quarters  where  the  British  tariff  has  taken  them  off,  not  only 
withdrawing  protection  from  American  skill  and  labor,  but  taxing 
them,  as  the  following  comparative  table,  prepared  by  Mr.  Williams, 
and  representing,  in  these  particulars,  the  tariffs  of  1846  and  1842, 
with  the  British  tariff  for  the  same,  will  show.  It  will  be  found  in 
the  note  below.* 

Tariff  of  1846.  Tariff  of  1842.         British  Tariff. 

•  Coarse  wool 30  per  cent 5  per  cent free. 

Raw  hides  and  skins 5  "  5  "       free. 

Wood,  mahogany,  &c 20  "  15  "       free. 

other  kinds,  except  timber. 30  "  free.  free. 

Antimony,  crude 20  "  free.  free. 

Barilla 10  "  free.  free. 

Bark  of  the  cork-tree 15  "  free.  free. 

Berries  used  for  dying; 5  "  free.  free. 

Brimstone,  or  sulphur 20  "  free.  free. 

Dyewoods 5  "  free.  free. 

Ebony 20  "  free.  free. 

Cochineal 10  "  free.  free. 

Crude  saltpetre 5  "  free.  free. 

Burr  stones,  unwrought 10  "  free.  free. 


526  THE    TARIFF    OF    184(). 

The  effects  of  the  famine  in  Ireland,  and  of  the  scarcity  of  bread- 
stuffs  in  Europe,  in  1846  and  1847,  making  a  market  for  American 
bread-stuffs  to  an  unprecedented-  amount,  have  been  held  up  by 
the  advocates  of  Free  Trade  in  this  quarter  as  the  fruit  of  the  tariff 
of  1846.  What,  then,  has  produced  the  cessation  of  that  demand, 
under  the  same  tariff?     Such  a  reason  would  rather  make  the  tariff 

Tariff  <if  1 8^fi.  Ta.ifT of  1812.  British  Tariff. 

Brnss,  old 5  per  cent free. 

Gum  Arabic 10  "  free.  free. 

India  rubber 10  "  free. 

Kelp 10  "  free. 

Kermes 5  "  free. 

Precious  stones 10  "  7  per  cent free. 

Pearl,  mother  of 5  "  free.  free. 

Ivory,  unmanufactured 5  "  free.  free. 

Madder 5  "  free.  free. 

Palm  leaf,  unmanufactured. ..  10  "  free.  free. 

Ratans  and  reeds,     do 10  "  free.  free. 

Shellac 5  "  free.  free. 

Sumac 5  "  free.  .  ..< .  ...free. 

Weld 5  "  free.  free. 

Tin,  in  sheets  or  plates 15  "  2|  per  cent. 

Tin,  in  pi^s,  bars,  or  blocks. . .   5  "  1  " 

Tortoise  shell 5  "  5  "       free. 

"We  might  extend  this  list,"  says  Mr.  Williams,  "but  enoush  is  given  to  show 
the  comparative  legislation  of  the  American  and  British  governments,  with  regard 
to  raw  materials  and  other  articles  essential  for  the  use  of  manufactures  and  in  the 
arts.  While  the  British  parliament  are  removing  all  duties  on  articles  required 
for  the  use  of  their  manufacturers,  our  American  Congress  have  increased  the  bur- 
dens of  our  manufacturers,  by  additional  duties  on  the  raw  materials  imported  for 
their  use;  at  the  same  time  that  they  have  reduced  the  protective  duties.  Was 
there  ever  a  parallel  case  of  injustice  in  the  history  of  legislation  in  any  country  ? 

"  Several  classes  of  articles  used  in  manufactures,  which  pay  small  specific  rates 
of  duties  by  the  tariff' of  1842,  have  been  changed  by  the  new  tariff"  [of  1 846],  and  on 
most  of  them  the  ad-valorem  rates  will  be  higher  than  the  specific  rates  now  paid. 
The  following  will  serve  as  specimens,  taking  the  duties  actually  paid  on  the  last 
importations,  by  the  report  of  the  secretary  of  the  treasury: — 

Rates  of  Tariff  on842.  Equalto.  Rates  of  Tariff  of  1846. 

Indigo 5  cents  per  pound 65  percent 10  percent. 

Bristles   1  cent       do 2  "       5         " 

Flax $20  per  ton 10  "        15         " 

Paper  rags 25  cents  per  100  lbs. . ..    65        "       5         " 

"  On  all  the  previously-named  articles,  it  will  be  observed,  the  duties  are  in- 
creased, except  rags,  on  which  there  is  a  small  apparent  reduction  on  those  of  the 
qualiiy  imrorted  last  year. 

"  The  importance  in  amount  of  raw  materials  and  other  articles  imported  for  our 
manufactures,  is  shown  by  the  following  statement  of  the  value  of  part  of  those 
articles  iinptirted,  for  the  year  ending  June  30,  1845  —  (the  last  returns).  Let  it 
be  borne  in  mind,  that  while  our  government  withdraws  a  large  proportion  of  the 
protection  to  our  manufactures,  by  reducing  the  rates  of  duties  on  articles  imported 
coming  in  direct  competition  with  them,  it  taxes  them  with  additional  duties  on  the 


THE    TARIFF    OF    1846.  527 

of  ]842  the  cause,  as  the  prices  of  American  bread-stuffs  were 
higher  in  tlie  winter  of  1845-'6,  under  that  tariff,  than  in  the  win- 
ter of  1846— '7,  under  the  latter  tariff.  The  great  demand  arose, 
and  the  prices  mounted  to  the  highest  pitch,  under  the  former,  and 
both  have  fallen  off  under  the  latter,  and  are  tending  rapidly  to  the 
old  level,  and  peradventure  will  yet  be  less  than  ever.      What  is 

raw  materials  used  ;  as  if  intentionally  to  deprive  them  of  the  ability  of  competing 
with  the  British  manufacturer,  who  obtains  the  like  raw  materials  free  of  duty. 

"  Value  of  Articles  imported,  principally  for  the  Use  of  Manufactures,  in  the  year 

ending  June  30,  1845. 

ARTICLES  PAYING  DUTY.  Amount. 

Coarse  wool $1,553,789 

Mahogany 261,292 

Rose  wood 18,9 1 2 

Satin  and  cedar  wood 18,878 

Indigo 862,700 

Bristles 172,076 

Flax 90,509 

Rag;s 42 1 ,080 

Block  tin  and  other  articles,  at  1  per  cent,  duty 212,975 

Tin,  in  plates  or  sheets,  &c.,  at  2.J  per  cent,  duty 1,690,460 

Raw  hides  and  skins,  &c.,  at  5  per  cent,  duty 1 ,97 5, 1 03 

7,277,674 

ARTICLES    FREE    OF    DUTY. 

Dyewood,  in  sticks 603,408 

Wood,  unmanufactured 87,315 

Burr  stones,  unwrought 32,624 

Brimstone  and  sulphur 108,619 

Bark  of  the  cork-tree 8,812 

Barilla 22,9 17 

Nuts  and  berries,  used  in  dyeing 132,490 

Clay,  unwrought 14,670 

Articles  not  enumerated 2,958,563 

Total 1 1,247,092 

"It  is  within  bounds  to  say,  that  the  additional  taxes  imposed  on  the  manufac- 
turer by  the  new  tariff,  on  raw  materials  alone,  will  amount  to  at  least  10  per 
cent.,  or  over  one  million  of  dollars,  unless  we  suppose  that  the  operation  of  this 
tariff  should  reduce  or  destroy,  as  it  probably  may,  some  branches  of  manufactures, 
and  thus  diminish  the  tax  impo.sed  on  them.  Compare  this  effect  with  the  new 
British  tariff,  which  releases  the  more  favored  manufactures  of  Great  Britain  from 
taxes  on  raw  materials  formerly  paid,  amounting  to  more  than  five  millions  of 
dollars. 

"  The  great  leading  interests  of  national  industry  which  will  be  most  affected  by 
our  new  tariff,  arc  the  manufactures  of  iron,  cottons,  woollens,  leather,  paper,  ma- 
chinery, lead  in  its  various  branches,  glass,  ready-made  clothing,  and  cordage. 
Many  other  branches  of  manufactures  might  be  mentioned,  which  will  be  affected 
directly  or  indirectly.  Indeed,  we  apprehend  all  classes,  who  depend  on  their  daily 
labor  for  subsistence,  will  suffer  by  this  blow  at  our  protective  system  ;  for  while 
the  great  manufacturing  interests  we  have  mentioned  are  prostrated,  the  country 


528  THE    TARIFF    OF    1846. 

the  cause  of  this?  To  ascribe  these  results  to  legislation,  either 
of  Great  Britain  or  of  the  United  States,  or  of  both,  is  proving  too 

can  not  be  prosperous;  and  if  the  condition  of  the  people  will  not  sustain  the  pres- 
ent or  recent  demand  for  articles  of  consumption,  how  can  those  classes  of  mechan- 
ics, manufacturers,  and  others,  who  seem  to  be  protected  by  the  new  tariff,  flour- 
ish, with  a  diminished  and  constantly-decreasing  market  for  their  fabrics? 

"We  might  also  notice  those  branches  of  industry  which  have  recently  sprung 
into  existence,  or  have  exhibited  signs  of  life  and  excited  hopes  for  the  future;  but 
which  infantile  manufactures  must  be  checked  or  destroyed,  under  the  operation 
of  the  new  tariff'.  Among  these,  the  important  interest  of  silk  should  be  named  as 
the  most  prominent.  The  tarifl'  of  1842  wisely  fixed  specific  and  other  protective 
rates  of  duty  on  manufactures  of  silk,  which  were  considered  absolutely  necessary 
to  sustain  this  new  branch  of  industry,  and  under  those  auspices  it  has  been  fast 
growing  into  importance,  exciting  the  most  lively  interest  in  many  parts  of  the 
Union.  The  new  tariff  repeals  the  specific  duties  on  silk,  and  fixes  a  low  rate  of 
ad-valorem  duties,  leaving  the  enterprising  and  industrious  citizens  who  have  en- 
gaged in  its  cultivation  and  manufacture,  at  the  mercy  of  foreign  competition. 

"  Thus,  then,  we  see  that  the  present  approaches  to  what  is  erroneously  called 
'Free  Trade,'  is  in  England  one  thing,  and  in  the  United  States  another.  In 
England,  it  is  to  lay  the  heaviest  duties  on  the  great  articles  of  tobacco,  tea,  coffee, 
distilled  spirits,  sugars,  and  wines,  not  one  of  which  is  produced  in  the  realm,  but 
which  are  largely  imported,  and  which  pay  two  thirds  of  the  whole  customs  reve- 
nue, and  to  remove  the  duty  from  every  species  of  material  that  enters  into  manu- 
factures of  any  kind,  thus  sustaining  the  industry  of  her  working  classes.  While 
in  the  United  States,  what  is  called  '  Free  Trade,'  or  an  approach  to  it,  is  to  reduce 
the  duty  on  all  manufactured  goods,  and  to  increase  it  to  the  destruction  of  the 
working  classes,  on  many  raw  materials,  as  we  have  already  shown. 

"  Does  not  this  establish,  beyond  all  dispute  or  cavil,  that  no  such  thing  as  '  Free 
Trade'  now  exists,  or  can  exist?  and  that  while  England,  our  great  rival,  is  doing 
everything  she  can  to  foster  and  sustain  her  superiority  in  manufacturing,  our 
present  rulers  are  playing  most  completely  into  her  hands,  and  rendering  us  more 
and  more  tributary  to  her,  while  lessening  our  ability  lo  pay  for  every  foreign  pro- 
duction imported  into  this  country  ? 

"  The  plain  truth  is,  and  it  is  folly  to  attempt  to  conceal  it,  that  the  worst  evil, 
the  skill,  capital,  and  labor  of  this  country  have  to  contend  with,  is  its  own  present 
government,  who,  not  content  wiih  demanding  specie  in  all  payments  made  to  them 
by  the  people,  have,  by  the  enactment  of  the  tariff  of  1846,  legislated  against  Amer- 
ica, and  in  favor  of  England." 

Though  not,  perhaps,  directly  in  place,  yet  having  been  left  out  where  it  more 
properly  belonged,  it  is  worthy  of  remark,  that  the  anti-corn  law  league  of  Eng- 
land originated  with  British  manufacturers,  with  a  view  ultimately  to  reduce  the 
wages  of  labor.  The  same  men,  manufacturers  (see  first  annual  report  of  poor  law 
commissioners),  who  were  engaged  in  1834  in  dragging  paupers,  against  their  will, 
from  the  south  of  England,  10,000  in  a  single  group,  to  immure  them  in  the  man- 
ufactories of  the  north,  professedly,  as  appears  from  their  letters  to  the  commission- 
ers, to  counteract  the  trades-unions  and  keep  down  the  strikes — in  other  words,  to 
keep  down  wages  —  were  afterward  enrolled  among  the  most  influential  leaders  of 
the  league  for  the  abolition  of  the  corn  laws;  and  Sir  Robert  Peel,  naturally  sym- 
pathizing with  that  system,  which  had  been  to  him  "  the  goose  that  laid  the  golden 
egg"  (his  immense  fortune  was  made  in  manufacturing),  and  not  less  as  a  great 
statesman,  put  the  finishing  stroke  to  that  great  measure  for  the  conservation  and 
protection  of  the  British  manufacturing  system.     The  first  step  was  forcing  the 


THE    TARIFF    OF    1846.  629 

much,  as  breadstiifFs  have  been  higher  in  England  when  Free  Trade 
there  said  they  would  be  lower,  and  as  our  own  tariff  of  1842  did 
better  than  that  of  1846,  in  raising  the  prices  of  these  articles,  if 
either  had  any  influence  of  this  kind.  But  all  know  that  legisla- 
tion has  had  no  more  to  do  with  this  matter  than  it  has  with  the 
profits  of  an  epidemic  to  the  medical  profession,  or  with  the  want 
of  such  profits  in  the  return  of  general  health  ;  and  none  but  men 
of  intellectual  or  moral  obliquity  would  ever  resort  to  such  rea- 
soning. 

paupers  of  England,  in  1834,  into  ttie  manufactories  ;  the  next  was  the  removal  of 
duties  on  raw  cotton,  in  1845;  and  the  third  was  the  abolition  of  the  corn  laws,  in 
1846 :  all  done  on  the  principle  of  Protection,  and  to  maintain  the  system  of  low 
wages,  without  which  British  manufactures,  the  soul  and  bulwark  of  the  empire, 
must  have  fdllen.  It  is  now  confidently  expected  and  predicted,  that,  as  soon  as 
decency  will  permit,  the  wages  of  operatives  in  British  manufactories  will  be  re- 
duced, by  a  measure  equal  to  the  cheapening  of  their  bread,  that  the  benefit  of  the 
abolition  of  the  corn  laws  may  accrue,  not  to  the  laborers,  but  to  their  employers; 
in  other  words,  to  the  government;  for  the  government  support »these  sreat  inter- 
ests, that  they  may  support  the  government.  The  amount  of  wheat  used  for  paste 
in  the  cotton  factories,  is  said  to  be  equal  to  the  supply  of  all  the  mouths  of  the 
operatives.  Eight  hundred  thousand  bushels  are  used  annually  for  paste  by  mem- 
bers of  the  anti-corn  law  league,  from  the  tax  on  which  they  are  relieved  by  the 
abolition  of  the  corn  laws. 

This  great  measure,  therefore,  which  has  been  bruited  far  and  wide,  to  the  great 
astonishment  of  mankind,  as  a  Free-Trade  measure  —  or  the  movement  of  a  great 
nation  in  a  philanthropic  career,  to  give  the  poor  cheaper  bread  —  turns  out  to  be 
the  movement  of  British  manufacturers,  to  bar  the  necessity  of  raising  the  wages 
of  their  operatives,  and  in  the  end  to  cheapen  them;  and  of  the  British  govern- 
ment to  sustain  and  protect  the  British  manufacturing  system,  as  the  great  bulwark 
of  the  empire.  Sir  Robert  Peel  saw,  that  the  British  corn  laws,  or  the  manufac- 
turing system,  must  fall,  and  he  wisely  sealed  the  doom  of  the  former,  to  save  the 
latter. 

It  will  be  seen,  then,  what  this  flourish  of  British  Free  Trade  amounts  to,  viz., 
that  at  bottom,  in  principle,  and  in  its  ultimate  practical  design,  it  is  directly  the 
opposite  of  Free  Trade,  and  that  it  is  one  of  the  most  comprehensive  and  most 
effective  measures  of  Protection  ever  devised  by  a  statesman. 

34 


530   THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES. 


CHAPTER  XXXIII. 

THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES. 

The  Contingencies  of  Free  Trade. — Review  of  our  Commercial  History,  as  it  discloses 
ContiiigenL-ies. — What  makes  a  Sound  Currency. — As  a  Man  that  fails  frequently  in 
Business  can  not  get  rich,  so  neither  can  a  Nation. — The  possible  Destiny  of  the  Country, 
under  a  Protective  System,  grand  and  glorious. — Free  Trade  devours  all,  and  then  eats 

up  itself. 

That  the  destiny  of  the  United  States  is  contingent,  is  evident 
enouo;h  :  contiiio;ent  as  to  whether  the  nation  will  adhere  to  its 
original  principles  ;  contingent  as  to  whether  it  will  continue  for  ever 
a  republican  empire,  or  degenerate  into  monarchy  ;  and  contingent 
as  to  whether  it  will  maintain  a  protective  system,  or  abandon  it 
for  Free  Trade.  It  is  this  last-named  contingency  only  which  we 
propose  to  consider.  It  is  believed  that  the  preceding  chapters 
afford  sufficient  data  to  run  out  the  line  which  this  contingency 
indicates. 

As  to  the  alternative  of  adopting  the  policy  of  Free  Trade,  one 
would  suppose  that  we  have  had  experience  enough  to  render  that 
morally  impossible.  But  no  one  can  tell  beforehand  what  folly  a 
nation  will  be  guilty  of,  nor  predict  the  misfortunes  into  which,  by 
such  means,  it  may  be  plunged.  Since  the  federal  administration 
has  so  recently,  and  for  the  first  time  in  the  history  of  the  country, 
abandoned  the  policy  of  Protection,  declared  itself  for  Free  Trade, 
and  caused  to  be  adopted  corresponding  measures,  it  must  be  con- 
fessed that  such  facts  are  not  ominous  of  good.  But  as  the  bitter 
experience  of  past  measures  of  the  same  kind  can  not  but  be  again 
renewed  ere  long  by  the  operation  of  these,  there  are  many  chances 
that  the  lessons  of  this  schoolmaster,  which,  as  one  has  said,  "  charges 
high  wages,"  will  avail  much  to  rectify  the  views  of  the  public 
mind,  and  bring  back  the  nation  to  its  senses.  If  the  history  of 
the  past  is  reliable  evidence  of  the  future,  that  like  causes  will  con- 
tinue to  produce  like  effects,  it  is  not  difficult  to  determine  the 
destiny  of  the  United  States,  under  a  Free-Trade  policy.  The 
commercial  embarrassments  of  the  country  from  1783  to  1790, 
under  the  confederation,  for  want  of  power  in  the  states  to  unite  in 
a  system  of  protection,  constitute  a  formidable  class  of  facts,  shed- 
ding light  on  this  point.     The  period  of  some  five  to  seven  years 


THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES.       531 

antecedent  to  the  tariff  of  1824,  is  another  melancholy  cycle  of  our 
commercial  history,  replete  with  general  distress  and  ruin,  all  for 
want  of  a  protective  system.  And  is  it  necessary  to  bring  to  view 
again  the  facts  of  like  character,  several  limes  presented  in  this 
work,  which  so  disastrously  signalized  the  period  of  some  half- 
dozen  years  antecedent  to  the  tariff  of  1842,  and  which  brought 
the  country  to  the  brink  of  commercial  ruin,  all  for  want  of  a 
protective  system?  Can  the  future  fail  to  justify  the  past?  Is 
there  not  light  enough  in  this  history?  —  We  have  before  us, 
then,  the  certain  destiny  of  the  United  States,  under  a  system  of 
Free  Trade. 

Of  all  reasons  that  can  be  urged  in  favor  of  a  protective  policy, 
no  one  perhaps  can  be  named  of  greater  cogency  than  its  necessity 
for  a  good  and  adequate  currency.  The  currency  of  the  country 
—  a  sound  currency  —  does  not  depend  on  banking,  or  the  modes 
of  banking,  or  whether  banking  be  done  by  a  national  institution,  or 
by  state  corporations,  or  by  both,  or  by  neither,  though  doubtless 
there  is  a  choice  in  modes  —  a  better  way.  There  can  be  no 
sound  currency  where  there  is  no  money ;  and  there  never  can  by 
money  enough  for  the  currency  of  a  country  which  is  constantly 
sending  off  more  than  it  brings  back  —  unless  one  of  its  products 
be  money,  as  has  been  the  case  with  Mexico  and  some  of  the 
South  American  states.  In  that  case,  money  is  not  the  medium, 
but  an  article,  of  trade.  But  the  United  States  do  not  produce 
money  in  any  quantity  sufficient  to  rely  upon,  either  as  an  article, 
or  basis,  or  medium  of  trade.  We  are  obliged,  therefore,  to  de- 
pend on  getting  and  keeping  money  enough  hy  trade  to  answer  the 
purposes  of  a  currency. 

jA  man  may  have  a  very  large  estate,  well  stocked,  well  worked, 
and  be  making  extensive  improvements  ;  but  if  he  buys  more  than 
he  sells,  his  money,  or  active  capital,  is  all  the  while  growing  less ; 
and  unless  he  has  a  great  deal  of  it,  he  will  soon  find  himself  em- 
barrassed^ When  this  state  of  things  arrives,  he  is  precisely  in 
the  condition  of  a  nation  that  has  been  guilty  of  the  same  improvi- 
dence. Without  money,  neither  he  nor  a  nation  can  do  business 
to  advantage.  An  income  is  as  necessary  to  a  nation  as  to  a  pri- 
vate individual ;  and  the  income  of  a  nation  is  the  money  it  gets  by 
selling  more  than  it  buys.  While  this  is  the  case,  it  is  impossible 
that  the  currency  of  a  nation  should  be  bad  or  inadequate.  A 
bank  here  and  a  bank  there  may  fail,  as  private  individuals  do,  and 
for  like  reasons  of  mismanagement  or  misfortune  ;  but  there  can 


532   THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES. 

be  no  such  thing  as  a  general  bank  suspension  when  the  public 
policy  is  such  as  to  secure  the  coming  in  of  more  money  than  goes 
out,  or  when  there  is  enougli  in  to  prevent  more  going  out  than 
comes  in.  These  results,  in  one  case  or  the  other,  are  always  con- 
tino-ent  on  the  sufficiency  or  insufficiency  of  the  protective  policy. 

The  intimate  and  indissoluble  relation  of  the  protective  policy  to 
the  currency  of  the  country,  commends  it,  therefore,  as  a  point  for 
consideration  too  important  to  be  overlooked.  No  man  can  trade 
safely,  and  with  a  warrant  of  prosperity,  except  on  the  basis  of  a 
credit  which  solid  capital  affords,  and  with  such  means  as  that 
credit  will  constantly  supply  him.  The  moment  his  means,  and 
with  his  means,  his  credit,  fail,  lie  is  stopped.  There  is  no  use  in 
bis  trying  to  go  on  ;  it  is  impossible,  except  by  a  transient  career 
of  fraud,  which  only  makes  it  worse  when  he  is  found  out. 

It  is  precisely  the  same  with  a  nation  in  its  trade  with  the  rest 
of  the  world.  When,  for  the  lack  of  an  adequate  protective  policy 
—  which  is  the  same  thing  as  the  improvidence  of  a  spendthrift  — 
it  is  habitually  buying  more  than  it  sells,  and  its  money  goes  off  to 
settle  balances,  its  means  of  trade,  domestic  as  well  as  foreign,  are 
all  the  while  growing  less  and  less  ;  and  without  a  change,  a  reform, 
that  nation  must  fail.  Its  insolvency  is  as  inevitable  as  that  of  an 
improvident  individual  who  conducts  business  on  the  same  prin- 
ciples. The  way  in  which  the  insolvency  of  a  commercial  nation 
shows  itself  is,  first,  by  a  scarcity  of  money,  which  everybody  feels  : 
as  a  consequence,  a  general  contraction  in  all  monetary  operations, 
by  which  business  is  carried  on,  necessarily  drawing  along  with  it 
commercial  inactivity,  dulness  ;  diffidence  in  all  credit  transactions  ; 
and  at  last,  if  no  relief  comes,  the  banks  suspend.  This  last  act 
is  the  consummation  of  a  nation's  commercial  insolvency.  The 
banks,  at  the  moment,  and  during  the  whole  time  of  suspension, 
may  be  sound,  as  the  specie  in  their  vaults  is  not  the  exponent  of 
their  capital.  Being  allowed  by  their  charters  to  issue  more  paper 
than  they  have  specie,  the  heavy  commercial  exchanges  against 
the  country  operate  directly  on  their  vaults,  to  draw  off  the  specie 
into  foreign  parts,  and  they  are  compelled  to  suspend,  or  part  with 
the  last  cent.  Even  then  they  ijiust  suspend,  so  long  as  they  have 
more  paper  out  than  specie  in.  It  is  the  unfavorable  state  of  for- 
eign exchanges,  the  large  commercial  balancesjagainst  the  country, 
which  occasion  a  general  bank  suspension,  /it  is  because  there  is 
not  money  enough  in  the  country  to  pay  its  aebts;  and  like  a  mer- 
chant, who  finds  himself  in  a  like  condition,  to  avoid  complete  and 


THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES.       533 

irretrievable  ruin,  that  would  incapacitate  the  country  for  all  trade, 
the  banks  stop  payment,  to  the  injury  oftheir  own  credit  and  the  credit 
of  the  country.  They  can  not  help  it.  They  are  forced  into  it  by 
the  effect  of  the  policy  of  the  government,  which  tempts  the  people  to 
buy  more  than  they  sell,  and  the  nation  to  do  the  same,  till,  after 
repeated  and  long-continued  drafts  on  the  money  of  the  country, 
the  pressure  begins  to  be  felt ;  and  before  the  remedy  can  be  ap- 
plied—  for  it  is  too  late  when  the  effects  of  such  improvidence 
have  already  come  —  the  whole  community  is  involved  in  the  gen- 
eral calamity,  jit  is  only  for  the  want  of  an  adequate  protective 
system.  \  So  long  as  an  industrious  and  producing  nation  does  not 
buy  more  than  it  sells,  it  is  impossible  it  should  be  involved  in 
general  commercial  distress  —  absolutely  impossible  in  the  nature 
of  things.  A  nation  of  such  resources  and  wealth  as  the  Uni- 
ted States,  with  such  an  enterprising  population,  can  bear  a  great 
deal  of  loss  in  its  foreign  trade,  and  yet  prosper.  Think  of  seven 
hundred  millions  of  loss  in  a  half-century,  as  appears  from  the  facts 
exhibited  in  chapters  xxiv.  and  xxv.  (see  p.  402).  This  has  been 
more  than  the  nation  could  bear ;  and  hence  its  frequent  calamitous 
vicissitudes.  Under  an  adequate  and  uniform  protective  policy, 
such  disasters  could  never  come.  There  can  not  be  an  effect  with- 
out a  cause.  Such  a  country  as  the  United  States,  which  is  a 
world  in  itself,  and  capable  of  producing  everything  essential  to 
the  complete  and  perfect  independence  of  a  nation,  in  articles  of 
luxury  as  well  as  necessity,  ought  never,  by  the  improvidence  of 
legislation,  to  be  in  debt  to  other  nations.  There  is  no  apology  for 
it.  It  has  sometimes  been  said  that  such  a  state  of  things  comes 
from  the  fault  of  the  people.  But  this  will  not  answer,  so  long  as 
the  government  permits  the  foreign  factor — who  is  not  a  citizen, 
and  who  lias  no  other  interest  than  to  make  his  fortune,  and  then 
carry  the  money  away  —  to  bring  his  goods  and  merchandise,  with- 
out paying  for  the  privilege  ;  or,  if  he  pays,  pays  nothing  adequate 
to  protect  American  citizens  in  the  same  business  ;  and  thus  tempts 
jobbers,  and  jobbers  tempt  retailers,  and  retailers  tempt  the  people, 
till  the  latter  are  in  debt,  which  can  only  be  discharged  by  a  re- 
mittance through  the  same  channels  backward  ;  and  the  foreign  fac- 
tor departs  with  the  money  of  the  people  in  his  pocket.  The  par- 
ties concerned  in  all  the  stages  of  the  trade,  have  doubtless  profited 
by  it ;  but  the  people  are  ruined,  because  their  money  has  gone  out 
of  the  country,  and  they  have  little  or  nothing  left  to  pay  other 
debts,  and  do  business  with. 


534        THE  CONTINGENT  DESTINV  OF  THE  UNITED  STATES. 

It  is  remarkable  that  all  the  commercial  troubles  of  the  United 
States  have  occurred  under  a  system  of  low,  anti-protective  duties, 
as  has  been  several  times  proved  in  the  progress  of  this  work  ;  that 
the  country  has  never  prospered,  except  under  a  protective  system  ; 
and  that  it  has  uniformly  been  most  prosperous  under  the  highest 
protective  duties.  These  are  historical  facts.  These  fluctua- 
tions, from  prosperity  to  adversity,  and  from  adversity  to  prosperity, 
sometimes  greater  and  sometimes  less,  in  the  history  of  the  country, 
have  been  fully  explained  on  the  principles  of  the  opposing  sys- 
tems of  a  protective  and  anti-protective  policy,  as  having  been 
graduated  precisely  as  the  one  or  the  other  of  these  has  prevailed, 
the  facts  always  harmonizing  with  the  theory,  that  protection  is 
favorable  to  prosperity,  and  the  want  of  it  unfavorable. 

It  follows,  therefore,  that  nothing  was  necessary  from  the  begin- 
ning of  our  history  as  a  nation,  to  have  secured  uninterrupted  com- 
mercial prosperity,  and  an  uninterrupted  sound  currency,  but  a 
uniform  and  adequate  protective  system.  The  state  of  the  cur- 
rency, as  has  been  seen,  always  agrees  with  the  presence  or  ab- 
sence of  protection,  and  the  reasons  have  been  explained.  What, 
then,  would  have  been  the  state  of  the  country  at  this  moment, 
comparatively,  in  wealth,  greatness,  and  power,  if  it  had  not  been 
so  repeatedly  broken  down  for  want  of  protection  ?  The  answer 
will  be  found  in  the  history  of  any  two  men  engaged  in  business, 
one  of  whom  never  failed,  and  the  other  of  whom  has  failed  many 
times.  Look  at  the  fortunes  accumulated  by  Stephen  Girard,  of 
Philadelphia,  by  John  Jacob  Astor,  of  New  York,  and  by  many 
other  men  of  the  same  class,  who  never  failed.  If  any  of  them  had 
broken  down  a  plural  number  of  times,  as  the  United  States  have, 
by  an  impolitic  change  in  their  habits,  by  an  experiment,  as  enter- 
prising men  they  might  still  have  mentled  their  fortunes  by  correct- 
ing their  habits,  after  each  disaster ;  but  ihey  would  never  have 
attained  to  great  wealth.  Thus  might  the  United  States  have  be- 
come, even  by  this  time,  the  richest,  greatest,  most  powerful  na- 
tion on  earth,  if  it  had  established  at  the  beginning,  and  maintained 
throughout,  an  adequate  and  uniform  protective  system.  That  it 
would,  at  least,  have  become  greatly  rich  and  greatly  powerful, 
compared  with  its  present  condition,  is  as  certain  as  that  John 
Jacob  Astor  was  a  rich  man.  How  can  a  man,  or  a  nation,  always 
engaged  in  a  large  and  prosperous  business,  and  never  coming  to 
bankruptcy,  but  ever  going  farther  from  it,  fail  to  be  rich?  How 
can  a  man,  or  a  nation,  whose  annual  income  is  greater  than  the 


THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES.        535 

expenditures,  fail  to  accumulate?  But  let  a  man,  or  a  nation,  fre- 
quently fall  into  bankruptcy,  by  improvident  habits,  and  that  man 
and  that  nation  will  be  always  weak,  always  in  trouble  ;  or,  if  re- 
lieved by  a  new  and  more  prudent  start,  by  a  like  improvidence 
will  break  down  again.  Such,  and  for  this  reason,  has  been  the 
ever-changing  commercial  history  of  the  United  States. 

"  The  first  duty  of  all  good  government,"  says  the  Southern 
Planter,  "is  to  look  to  its  labor  —  insure  it  not  only  full  occupa- 
tion, but  the  greatest  productiveness.  Political  economy  abhors 
idleness  worse,  if  possible,  than  Nature  does  a  vacuum.  It  is 
worse  than  a  vacuum,  because  gravity  rushes  forth  to  fill  the  vacu- 
um ;  but  idleness  is  a  grave,  where  lies  dead  and  buried  the  crea- 
tive genius  of  man  —  tlie  means  given  to  him  by  the  God  of  Nature 
to  improve  his  condition.  .  .  It  would  appear  to  one  dropped  from 
another  world,  unacquainted  with  all  our  interests  and  resources, 
that  our  whole  Congress  or  national  legislature  were  taken  or  sub- 
sidized by  Europe  to  favor  all  their  productions  or  operations  ex- 
clusively—  even  to  the  total  disregarding  of  those  of  this  country. 
It  would  seem  to  such  that  Great  Britain  sat  enthroned  in  all  our 
legislative  halls,  and  dictated  all  their  enactments  regulating  indus- 
try and  a  tariff;  and  if  told  otherwise,  could  not  be  made  to  believe 
that  some  laws  and  most  impoi  tant  regulations  were  not  the  results 
of  bribes  on  the  body  politic  by  the  superior  wealth  and  foresight 
of  older  and  wiser  nations.  Every  idle  finger  will  be  pointed  some 
day  against  those  short-sighted  and  unpatriotic  legislators  who  left 
it  in  sloth,  and  to  vice  and  mischief,  instead  of  stimulating  it  to 
proper  action  and  usefulness.  .  .  This  country,  like  a  young  giant, 
knows  not  its  own  strength,  or  its  resources,  because  it  has  never 
exerted  the  one,  or  examined  the  other.  Nothing  is  wanted  to 
bring  forth  all  this,  but  a  permanent  policy,  a  certainty  of  protec- 
tion, a  security  of  the  home  market.  All  would  then  come  forth 
and  show  themselves  —  capital,  labor,  raw  materials,  a  market, 
wealth,  comfort,  elegance,  taste,  and  independence.  As  soon  as 
confidence  was  established,  they  would  flash  forth,  as  the  gas-lights 
when  touched  by  a  match.  No  country  is  underlaid  so  universally 
with  valuable  minerals;  and  they  lie  in  its  extended -fletz,  or  sec- 
ondary formation,  in  horizontal  strata,  that  can  be  followed  into 
the  thousands  of  hills  and  ridges,  and,  lying  above  the  valleys, 
can  be  poured  forth,  without  shafts  or  drainings,  to  the  fertile 
plains,  water-powers,  and  navigations,  that  are  there  found.  Had 
this  young  giant,  with  its  free  limbs,  hold  of  these  mines  of  wealth, 


536   THE  CONTINGENT  DESTINY  OF  THE  UNITED  STATES. 

in  the  real  skilful  way,  he  could  glut  and  monopolize  all  markets, 
in  both  the  raw  and  wrought  state.  These  hidden  treasures  need 
a  protecting  tariff  to  uncover  them  —  its  inducement  to  make  them 
avaihible,  and  wiser  statesmen  than  we  yet  have,  to  put  all  in  train, 
and  on  the  certainty  of  the  reality.  .  .  When  the  fulcrum  is 
furnished  by  Nature's  God  to  this  young  Archimedes  [the  United 
States],  it  still  fails  to  move  the  commercial  world.  Our  commerce, 
if  we  demanded  it,  might  double  with  England  around  the  great 
capes  of  South  America  and  Africa,  and  sweep  the  bays  of  Bengal 
and  Bombay  ;  might  scour  with  her  the  West  Fndies ;  might  run 
with  her  through  all  her  various  colonies  ;  and  in  every  port,  place, 
colony,  and  in  the  mother-country,  be  a  part  of  herself  as  to  the  fa- 
cilities secured  by  treaty.  No  nation  could  gainsay  us,  for  we  would 
be  in  possession  of  all  seas.  No  nation  could  war  upon  us,  for  we 
would  be  full  of  resources  and  wealth.  No  nation  could  counter- 
vail us,  for  we  would  control  all  the  productions  necessary  to  her 
existence.  We  would  stand  on  high  and  enviable  ground,  placed 
there  by  our  own  wisdom,  that  made  use  of  natural  advantages  and 
resources  too  valuable  to  nations  to  be  placed  on  any  doubtful 
footing.  This  young  Hercules,  that  strangled  not  the  serpent  in 
its  early  grasp,  will  fall,  like  Laoconn,  in  the  foldings  of  its  wrath." 
Never,  in  the  history  of  the  world,  did  a  nation  occupy  such  a 
position,  or  have  within  its  reach  such  means  of  wealth  and  power, 
as  the  United  States.  But,  for  the  alternative,  substitute  Protec- 
tion for  '■^Degree,''''  in  the  following  lines,  and  we  have  a  true  pic- 
ture of  the  character,  tendency,  career,  and  end,  of  Free  Trade  : — 

"  Take  but  Degree  away,  untune  that  string, 
And  hark  !  what  discord  follows  !     Each  thing  meets 
In  mere  oppugnancy.     The  bounded  waters 
Should  lift  their  bosoms  liigher  than  the  shores, 
And  make  a  sop  of  all  this  solid  globe. 
Strength  should  be  lord  of  imbecility, 
And  the  rude  son  should  strike  his  father  dead; 
Force  should  be  right ;  or  rather,  right  and  wrong, 
Between  whose  endless  jar  Justice  resides, 
Should  lose  their  names,  and  so  should  Justice  too. 
Then  everything  includes  itself  in  power ; 
*»        y  Powf^inlo  will ;  will  into  appetite  ; 
And  appetite,  a  universal  wolf, 
So  doubly  seconded  with  will  and  power. 

Must  make,  per  force,  a  universal  prey,  x"^  "     ' 

And  last  eat  up  itself."  —  Shakspeare. 


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f\.. 

jsiO            V:^)M 

f^r.'-n  --^ 

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Ut\jU  lu    AUG  2 

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YD  20032 


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